Preamble

The House met at half-past Nine o'clock

PRAYERS

[MADAM SPEAKER in the Chair]

Pensions

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Mike Hall.]

Mr. Steve Webb: As I look around the Chamber, I see several hon. Members who obviously spent substantial parts of their childhood playing "Monopoly". They will recall landing on "community chest" and hoping either to get a "Get out of jail free" card or, failing that, a card that says, "Your annuity has matured, collect £100"—that was in the days when £100 was worth something. When I used to play Monopoly, neither I nor any of my fellow players had a clue what an annuity was—and, in some respects, not a lot has changed. Yet The Observer newspaper recently pointed out that annuities are no longer something that appear only in Jane Austen novels but have replaced house prices as a topic of dinner party conversations in certain circles.
How has that come to pass? I suspect that I am not the only hon. Member who has received a growing number of letters from constituents who are concerned about the annuities problem. They are worried about low annuity rates and about being forced to buy an annuity at age 75. One example is my constituent from Thornbury, who is in his early 60s. He wrote to say that he had a self-invested pension plan from which he was drawing income in the manner allowed by the Inland Revenue up to the limits, leaving the capital largely intact. My constituent was concerned that, in a decade—the people of Thornbury are very far-sighted—he might be forced to buy an annuity with that pension pot, which would result in the loss of all his capital and leave him with a relatively poor pension. He writes:
it seems unjust that I will be compelled to buy this annuity, lose my capital sum, and yet receive no additional income.
What are we to make of this issue? I am a simple man and, in my simple way of looking at the world, I like to divide it into the good guys and the bad guys—it makes life an awful lot easier. When I approached the annuities issue for the first time, it occurred to me that the chances were that Her Majesty's Government were the bad guys. That is a fairly safe working assumption.
In this context, what makes the Government the bad guys on first examination is that they force people at age 75, against their will, to convert their personal pension pot or similar into an annuity. Why is that a problem? It is well known that annuity rates are now relatively low—certainly compared with their level at the start of the decade. At the beginning of the 1990s, annuity rates were

about double their present value. That obviously means that the pension that one can buy with a given personal pension pot is substantially less than it was in nominal terms. One could point out that the stock market has done relatively well during the same period and that therefore the pension pot would have grown. That would partly offset the difference—but only partly. There is a general perception among people in their 60s and early 70s that they are being forced to buy a product that will yield a relatively poor pension and cause the loss of all their capital.
Why is there a problem with forcing people into annuities at age 75? A typical strategy for money in a pension pot is that it begins life invested in high-risk, high-return, or middling-risk, high-return assets such as the stock market. Towards the end of one's working life, it is shifted into lower-risk assets such as gilts. When one converts to an annuity, for the rest of one's life, one buys a product that is backed by gilts—which are very low-risk but low-return assets. If one does not take out a pension particularly early in life, one could find that half the time one's money is invested in shares and the other half it is invested in low-yielding gilts. It is far from easy to see how, in a rational world, that is a sensible way to invest pension assets. It is difficult to see why, over a lifetime, one would want to invest half the time in low-risk, low-yield gilts. That is not a rational strategy.

Sir Robert Smith: That problem will not go away because, if the strategy of containing inflation is successful, gilts will continue to be low yield.

Mr. Webb: My hon. Friend is quite right: nominal yields will continue to be very low—although there is obviously a problem with perception. We have yet to generate a low-inflation culture. We recall that inflation rates were 10 per cent. at the beginning of the decade and I remember when inflation rates were 25 per cent. under the previous Labour Government. Against that background, nominal rates matter to people's perceptions of whether they are getting a good deal. Stable inflation over a long period would clearly be welcome. I am grateful to my hon. Friend for that intervention as I was about to turn to inflation.
As well as low annuity rates, a second reason for concern is the effect of inflation on people's incomes when they buy annuities. There are annuity products containing escalation that take some account of future inflation. When surveyed before retirement, most people tend to say, "Yes, I would probably get an annuity with some sort of indexation; I would not want my income to be eroded". However, that is not what people actually do because four out of five of them buy level annuities. In other words, they see how much less they would get in the first year and in the next few years if they bought an indexed annuity and say, "Hang on a minute, I would rather have 75 per cent. more in the first year and I'll take a gamble on inflation". While, in theory, one might think that indexed annuities are a good thing, in practice, most people do not buy them. Therefore, we are forcing people to buy a product that is likely to be eroded by inflation.
Inflation of only 3 per cent. for a decade would knock a quarter off a pensioner's real income. That means that as people get older—as they reach 80 or more—their living standards may fall dramatically. That issue will be


increasingly important as the Government force people who buy stakeholder pensions to convert them into annuities and as more occupational schemes move towards defined contributions. That is why I initiated this debate.
As well as low annuity rates and the effects of inflation, a concern about forcing people to buy annuities is the inevitable loss of capital. When I first heard that argument, I thought that people wanted to have their cake and eat it. I thought that they were saying, "I'd like a pension—probably the same pension that I would have got anyway—and I want to keep all my capital." That seemed to be rather like saying to a car insurance company, "I'll buy my car insurance and if, after 10 years, I haven't claimed, I'd like my premiums back." Clearly, that would be unacceptable, but people are not saying that. They want a blend of a particular level of pension income and a particular level of preservation of capital. They have saved for their old age and taken the view that they might sacrifice part of their pension income now to preserve some of their capital to pass on to their children.
In principle, there is no reason why we should not allow pensioners to do that, subject to tax and other considerations to which I shall turn in a moment. In principle, there is no reason why we should want to force pensioners to sacrifice all their capital at the age of 75 if they were prepared to forgo some of their pension income in return for keeping part of their capital. On the face of it, therefore, the Government are the bad guys because they have removed from people, or are not allowing them, a choice at the age of 75. That choice will not, by any means, be appropriate for all pensioners, but it is appropriate for growing numbers of them.
I have read the report of the proceedings of the Standing Committees that considered the Welfare Reform and Pensions Bill and the Finance Bill, and this issue was discussed twice. The Government rest their defence for the age-75 limit—which seems somewhat arbitrary—on two main arguments. First, the dreaded Inland Revenue wants its slice of the cake. The argument is that if people were allowed to keep their money in the pension pot, they might inconveniently die, so they would never get their annuity and the Inland Revenue would never get the tax.
That concern is unfounded. If people who have begun to draw down income from their pension pot die, their spouse or dependant can convert the pension into an annuity that can be taxed anyway. if that is not the case, a special 35 per cent. tax rate will apply to those funds. I suspect that 35 per cent. is much higher than the rate that the Revenue would typically receive from an annuity, so it might receive more money if a few more people popped their clogs before they took out annuities.
If draw-down has begun, tax is not a problem. The only problem seems to arise if draw-down has not begun and the pension pot has not been touched. There is no reason why the law should not state that at 75, or another age, people should take out an annuity or begin draw-down. It is not beyond the wit of the Inland Revenue to ensure that it gets its tax take, while preserving choice for pensioners.
The Inland Revenue objection does not stand, but there is one closer to home for the Minister—a Department of Social Security objection, which is that pensioners might spend, spend, spend and blow the pot on riotous living.

That might be welcomed, but the concern is that they would leave themselves in penury and throw themselves on the mercy of the stony-faced DSS.
I am not entirely convinced by that line of reasoning. First, as the Minister knows, there are strict Government rules on the amount that can be drawn down from a pot. There are clear limits on that, and one cannot simply blow a fund in one go. If we consider the sort of funds that we are discussing, we realise that draw-down will be appropriate only in larger funds. Some say that it would be suitable only in funds of over £100,000 and others say that £250,000 and over would be a suitable size. The idea that someone would blow £250,000 from a pension pot and then throw themselves on the delightful mercies of income support is pretty far fetched.
Secondly, there is no reason why there should not be further constraints on draw-down if the age limit of 75 were to be raised. Stewart Ritchie of Scottish Equitable, who is a member of the Government's pension provision group, has suggested that at age 76 or 77 there could be a slightly tighter limit. Instead of being the total amount that one could draw from a similar annuity, the limit could be a percentage of that figure. Obviously—I borrow Mr. Ritchie's example—we do not want to allow people aged 100, whose life expectancy is one year, to blow the entire pot, lest they inconveniently live to be 101. A safeguard is necessary, and that could be ratcheted in, but there is no reason for an absolute cut-off at age 75.
The final reason why the "people will just rely on the state" argument is not convincing is that most pensioners, particularly those who have carefully invested—such as my constituent, who has invested his money himself—are not about to go to the Ritz or Monte Carlo to blow all their money. They are very cautious, and they are motivated by the desire to pass on money to their children. The idea that they would spend all their money and throw themselves on the mercy of the state is implausible.
It seems that there could be little objection to allowing greater flexibility at age 75. A choice could be allowed between the purchase of an annuity and the commencement or continuation of draw-down, subject to certain restrictions.
I want to draw the attention of the House to another group of people who may also, in some sense, be the bad guys in this story—those who sell the income draw-down policies. They have not done themselves any favours in recent years. The early evidence on those policies reveals that tighter controls on the charges and conduct of those companies might be needed to go hand in hand with the reform of the age-75 threshold that I have already suggested.
This morning's Daily Mail contains a salutary warning about the possible mis-selling of income draw-down policies. It says that for two thirds of a sample of the 50,000 policies sold, there appears to be little documentation demonstrating why the policy was recommended. The Personal Investment Authority suspects that such a lack of documentation is often a proxy for mis-selling.

Mr. Howard Flight: Is the hon. Gentleman aware that some companies will not allow draw-down recipients to change investment manager once they have started draw-down, which is surely outrageous in the present climate?

Mr. Webb: The hon. Gentleman, who is very learned on these matters, and to whose contribution I look


forward, makes an important point about the regulatory framework within which the policies operate. There is considerable concern about that.
To give the House an example, the market leader in draw-down policies has produced statistics for them. Three years after the policies are taken out, they have to be reviewed to establish whether the pot is running down too quickly, in which case the amount being withdrawn has to be cut, or vice versa. The policies were introduced fairly recently, so we are starting to see the first round of three-yearly reviews. The alarming statistic is that one in three customers of the market leader whose policies have been reviewed since 1 January have had to accept cuts in their income. The average nominal drop is 20 per cent., which is substantial, because one must add on 10 per cent. of inflation over three years. People who have large pots can, it is hoped, cope with such fluctuation, but it is of concern to people whose income is borderline.
What has been the problem with those draw-down policies? Why has income from them fallen considerably? I shall briefly explain the three main reasons. The first, as I said earlier, is the fall in annuity rates, which are now substantially lower than they were three years ago, so the amount of money that people can get from an annuity based on a given pot will have fallen. In other words, if people had bought an annuity three years ago, they would have a higher lifetime pension than they do, because of the fall in annuity rates. Obviously, the converse would be true if annuity rates were rising, but the prospects of a significant rise are not particularly bright, so that problem may be with us for some time.
The second reason why many people are experiencing a fall in their income from draw-down policies is what is catchily known in the trade as mortality drag. If 63-year-olds have bought an annuity at age 60, the annuity provider will not have been sure that they will live to 63. Some people will have died at 61 or 62, and will have given the provider profit, allowing the company to put a little extra money into the annuity. If the annuity is recalculated for purchase at age 63, people have given away the fact that they lived for the preceding three years, so the annuity company considers them a worse risk and the annuity rate would be lower. That tends to reduce the amount that people can get from draw-down policies.
Charges are the third reason why some policies are not yielding good results, and this issue is of considerable concern. Moreover, if an income is drawn from the pot and the balance of the pot is then used for investment, that must battle against falling annuity rates, against mortality drag and against the fact that a big chunk of the money will be taken in charges. Against that background, unless the money is invested very well and the stock market does well, there is a risk—as the one in three people who took out draw-down policies three years ago and who now face a fall in their pension found out—of a fall in income.
I mention that situation to remind the House that income draw-down is not a one-way bet and may not be suitable for many pensioners with relatively modest pots. None the less, my judgment is that we should give pensioners—especially those with large pension pots, who may be more financially sophisticated—a choice. We need to tighten the regulation, but I am aware of no reason for allowing people draw-down for 10 years—during which all these problems can occur—and then suddenly,

when they reach of 75, telling them that we cannot allow it any more. That is an arbitrary cut-off point, and there are easy ways around the problems that I have cited.
In conclusion, I repeat my call for the Minister to introduce greater flexibility into pensioners' choices at the age of 75. I believe that pensioners should be given a choice, and that the arguments about possible loss of tax revenue or increased benefit expenditure do not stand up. However—this is an important caveat—I also believe that investors need to be protected, and that the regulation of draw-down schemes needs urgent attention. If the Minister will promise to do both those things, he may convince me that he is, after all, one of the good guys.

Dr. Vincent Cable: I congratulate my hon. Friend the Member for Northavon (Mr. Webb) on presenting this important subject for debate and on the clarity with which he dissects even the most arcane problem. The problem of pension policy and annuities is especially arcane.
About three months ago, I submitted a written question to the Treasury, asking when it proposed to revisit the regulation—I believe of 1921—that makes annuities obligatory. The answer that I received had the tone of lofty condescension and complacency that we have come to expect from the Treasury at its worst. That provoked me into looking into the problem of pension policy.
I want to emphasise the scale and extent of the problem. There are probably about 5 million potential annuitants. That very large number includes not only the personal pension holders that my hon. Friend the Member for Northavon mentioned, but a large number of people in defined contribution occupational pension schemes, many of which are linked to annuities—often with very little choice—and people who have made additional voluntary contributions. In terms of numbers, the problem is extensive.
The scale of the problem in terms of its impact on individual pensioners also needs to be emphasised. Figures recently reproduced by the Library showed that, for a 65-year old pensioner with a pension fund of about £100,000, the annuity value had collapsed from about £11,000 in 1990 to £5,500 today.
In many senses, the problem is getting worse, for two reasons. First, as my hon. Friend the Member for Northavon has described, it is getting worse as a result of trends in the gilts market. It may be assumed that gilt rates are at an all-time low, but that is almost certainly not the case. Various factors are continuing to drive down gilt yields. If we succeed in joining economic and monetary union in a few years' time, one of the effects will be to push down the long-term cost of capital—that is one of the reasons for doing it. Long-term German bond rates are even lower than our gilt yields. That will be a factor pushing down our gilt yields even further. Barclays Capital recently did some long-term projections, which suggest that gilt yields could go as low as 2 per cent. Powerful economic forces are pushing down gilt yields, and therefore annuity rates, even further.
Another factor working in the same direction is the fact that actuaries are constantly taking into account revised assessments of life expectancy. As individuals, we may be able to get our revenge on the actuaries by living


longer than we are expected to, but collectively, by definition, we cannot. The impact of that is necessarily to drive down annuity values.
I want to make a fundamental point on policy. Quite apart from the complexity of the matter and the impact of low annuities on individual pensioners, an important issue of principle is involved. It is a simple libertarian issue about whether people should have the freedom to make choices about how they manage their own personal finance. In this country, we have a tradition that is extraordinarily paternalistic and illiberal.
I quote from an 1888 report on which, I believe, the Government still draw heavily, which defined the basis on which state pensions should be dealt with in the 19th century. It argued against paying lump sums to pensioners as opposed to supplying a steady income stream. That report, written 110 years ago, said:
The payment…of a lump sum is open to the obvious objection that in the event of improvidence or misfortune…the retired public servant may be reduced to circumstances which might lead to his being an applicant for public or private charity".
That is exactly the attitude that prevails today, except that for "public or private charity" one should read "income support". We fundamentally object to that paternalistic, illiberal view of personal finance, regardless of the specific circumstances of many of our constituents.
Let me summarise what appear to be the central objections to annuity payments—at least in the rigid framework in which they operate today—from the pensioner's standpoint. There is an advantage to others—notably the Inland Revenue, which has a steady stream of income to tax—but the disadvantages are essentially four.
First, as my hon. Friend explained at length, in practice most annuities are level annuities, so the pensioner is exposed to inflation risk. Inflation prospects currently look extremely good, but it requires only a fairly plausible set of circumstances, such as a collapse in the value of the pound, to take inflation back up to levels at which the value of such annuities is substantially eroded.
Secondly, in present circumstances, annuities represent an extremely bad deal. People get a return of roughly 4.5 per cent. when they could be getting 8 per cent. in building societies, or 15.5 per cent. if the private companies were able to deliver the return that they are promising. It is an extremely bad deal in relation to what those companies claim they can earn in the market.
Thirdly, conversion into an annuity involves handing over wealth. That issue has been covered at length.
A fourth point, which I believe my hon. Friend, in his other capacity as our social security spokesman, would usually emphasise, is that low annuity rates are an enormous deterrent to the Government's long-term policy on pensions. The Government are trying to promote the idea of stakeholder pensions. They have not gone for compulsion, so they depend on psychology and motivation, and yet they are doing so in a context in which anyone thinking ahead and looking at the way in which their pension policy will play out will be enormously discouraged from pursuing it.
We are not simply talking about the disadvantages of annuities as they operate at present. There are alternatives in the market—some of which my hon. Friend has

described—but they need to be balanced against the costs. Draw-down schemes, or schemes with built-in equity elements, have commission costs. Above all, there are risks if one wants to pursue a high-return option to an annuity. However, the fundamental point is that individuals should be able to make that choice for themselves. That is the essence of this debate. There are alternatives in the market. The industry is sophisticated; it can provide them, especially now that, with the advent of the Financial Services Authority, its products will be regulated. Individuals should be able to make the choice for themselves.
I read from the report of an earlier debate that the Economic Secretary is promising a review of the problem. The results are expected in the autumn; we look forward to them. We look forward to much greater flexibility than the Government have demonstrated in the past. If the Government could unpick some of the rigidity and paternalism that have characterised British policy on pensions for the best part of a century, they would do us all a considerable favour.

Mr. Howard Flight: I have great sympathy with the Minister, who will have to defend arguments of 30 or 100 years ago which the hon. Members for Northavon (Mr. Webb) and for Twickenham (Dr. Cable) have described as out of date and paternalistic.
I wish to cover some separate ground in the overall territory. My original focus was on my perception that there will be a massive growth in the volume and proportion of money-purchase pensions over the next decade or so. That is already in train. Companies are moving from personal pensions to occupational defined contribution schemes, and we now have the stakeholder scheme. It is likely that, within 10 years, the proportion of pensions that are not in a final-salary type of scheme will be the majority. No one seems to have thought about how these savings of money will convert into pensions. There is the assumption that annuities were always the way and that that must be the right way of doing things.
Final-salary schemes have been one of the great successes in delivering pensions over the past 20 or 30 years. Such schemes do not have all their money invested in gilts. They have the maximum spread internationally, with about 80 per cent. or more in equities. They pay pensions out of that rolling pot of money. That is why pensions have been so successful in this country, and why about £800 billion was accumulated during the 18 years of the Conservative Government. If the schemes had been forced to invest in gilts, which is what annuities do, the accumulated total might have been a third of £800 billion, with the result that final-salary schemes would have been unable to afford to pay the improved pensions that they are now paying.
That told me that it must be wrong to put such a great deal of money into fixed-interest investment because of archaic rules when people are likely to have a pension for 20 years or more. Despite the success in reducing inflation, that must be wrong from an investment point of view. People who retire at 65 are likely to live to 85, and many who retire at 65 are forced to buy annuities, depending on the scheme to which they belong. I have in mind especially certain schemes for professionals. Even


people living to 75 may have widowed spouses who continue to live for 20 or 25 years. The trustees of any final-salary scheme would say that it would be grossly irresponsible to invest in fixed interest to such an extent.
A second area within this territory can be described as incompatibility. If, as a country, we are to have a roughly balanced budget, self-evidently the net new supply of gilts will be zero. If we are to have a huge and rising pool of money-purchase pension schemes that are obliged to buy gilts, it is simple to see what will happen in that supply-demand situation. Real yields will be driven down even further. Indeed, to some extent, that has already happened over the past two or three years.
The Pensions Act 1995 resulted in an increased pension fund demand for gilts, particularly on the part of mature pension schemes, as a result of safety arguments. As a consequence, the net supply of gilts has been very modest. Real yields have been about 2 per cent., against an average over the past 30 years of about 3.5 per cent. One of the arguments in the equation is that people's pots of money have increased in value because equity markets have performed well and interest rates have been low so that everything washes out. That does not happen, however, when there is a fall in real yields.
Unless there is much more flexible investment in money-purchase pensions for the future, the situation will stay as I have described it—and, indeed, worsen. The more virtuous the Chancellor of the Exchequer becomes in achieving his so-called prudence and a balanced budget, the lower will be the pensions that people will be able to buy with their savings if they are still stuck with having to buy fixed-interest annuities.
There is another immediate problem on which I have focused. I thought that it was well described in a talk given by the Governor of the Bank of England last week. The Governor pointed out that inflation in this country—as in America—is in a sense artificially low because of the financial problems of the emerging economies and the depreciation of their currencies. Mature economies are in a sense importing about 1 to 1.5 per cent. deflation as a result. That is mixing with about 3 to 4 per cent. domestic inflation and we are coming out with inflation at about 2.5 per cent.
The imported deflation will be transient and there is a strong argument that the real underlying rate of inflation in mature economies will be 1 to 1.5 per cent. higher. What is the level of inflation that long gilts are forecasting? It is bout 2 per cent. or less if we take 5 per cent. long gilt yields, which take off at 3.5 per cent., which should be the long-term real rate of interest. The assumption is that inflation will stay at about the present level and the sort of level predicted by the gilt market, which is extremely low. As the emerging economies catch up, and unless there are tight countervailing policies, western inflation will be somewhat higher than it is now.
In a way, people are being mis-sold, especially if they are buying non-inflation-indexed gilt annuities. They are buying a flow of income that apparently is expected to depreciate at only 1.5 to 2 per cent. per annum, but which is highly likely to depreciate by 2 to 3 per cent. per annum, all things being equal.
There is a problem at both ends of the scale. The dinner party conversation aspect, to which the hon. Member for Northavon alluded, is self-evident. I received a fascinating letter from one of my constituents, who has been one of

the pioneers of high-tech venture capital investment. He wrote along these lines: "Over the past 20 years, I have pulled together all my friends and a good bit of our self-administered pension funds have been invested in high-tech companies. They have done incredibly well and there is a huge amount in our pension pots. It seems ridiculous that now we are coming up to 75—we are still keen to continue investing in this way, thereby creating jobs—we must tip the whole lot into annuities. At the very least we should be obliged to tip into annuities only the minimum to keep us off the state in future." That argument, as advanced by those who have generously provided for their pensions, is irresistible and unanswerable.
There is a powerful argument at the other end of the spectrum, which applies particularly to women. I hope that the Government will pay due heed to the report that is to be produced by Oonagh McDonald's committee. It is being worked on. There are hundreds of thousands of people with small money-purchase pension accumulations of £40,000 or £50,000. Many of these people are cautious and responsible women who have worked part-time. It is interesting that most of the people living in West Sussex—it is allegedly a prosperous part of the world—who have written to me are in that category. They to me along these lines: "It is unjust. I have struggled to put £50,000 in my money-purchase pension scheme. I shall be forced to buy an annuity with it and to chuck the capital away." They know that they can often get better running returns merely by investing in, for example, a portfolio of high-yield and corporate bonds. The returns from an annuity will be pretty poor and people are offended about losing their capital.
I am persuaded by Oonagh McDonald's view that, for people in that category, the paternalistic 19th-century argument about keeping them off the shoulders of the state is not worth anything. They are likely to do much better with their £40,000 elsewhere. If there were any chance of their relying on the state, they would be relying on it already. They are being treated like those who were threatened with the workhouse about 100 years ago. There is a strong case for a liberal attitude towards modest pension fund accumulations.

Mr. Webb: May I raise another issue relating to annuities that we have not covered? I should be grateful for the hon. Gentleman's views on the open market option. My concern is that a lot of people who build up a pension pot do not grasp the fact that they can buy someone else's annuity. They could suffer significant losses. Does he think that the regulation of that area is adequate?

Mr. Flight: The hon. Gentleman is absolutely correct and—at a tangent—another territory is relevant. When individuals surrender any form of insurance policy, there is no obligation to tell them that they could sell it for a sum significantly larger than that for which they could cash it in. It is desirable, would be relatively simple and no great regulatory burden, for people to be obliged to be told that they could sell any insurance policy, rather than cashing it in with the insurance company.
One answer to the conundrum is to make available annuities with more flexibility, such as equity-linked, variable draw-down and term annuities. America presents an interesting range of choice, and South Africa presents


an even more interesting range. Ironically, South Africa's thinking is in advance of ours—it was much prompted by the trade unions, which objected strongly to their members being locked into financing the state. That is what having to buy an annuity amounts to. They rightly saw that pension accumulation offered, particularly for black Africans, a chance of a little economic freedom in accumulating their capital. Therefore, South Africa has a much more rational, flexible scheme.
People who buy an equity-linked indexed annuity are affected by a devious and unpleasant Inland Revenue rule, the effect of which is that they do not get the full benefit if such annuities do well. The Revenue says to insurance companies, "Keep the rest as a windfall profit." The gist of how the rule operates is that the Revenue correctly says that companies must allow for equity returns to fluctuate—they cannot take everything that is made in one year. However, if the bad years are not bad enough and the reserves do not get used up, people do not get the full benefit of what their annuity makes beyond what the companies are allowed to take. Not surprisingly, equity-linked annuities are not terribly popular and I am amazed at how clever and perceptive my constituents are. I pay tribute to them: they know of all those wrinkles and they have taught me a great deal that I did not know about this territory merely by raising all those points with me.
I utterly support the points that were made about the need for thorough review, more competitiveness and better regulation of draw-down alternatives. We have all been told that the Revenue is conducting a review of draw-down arrangements. I hope that it is wide ranging, because it should deal not only with the fancy formulas relating back to how much people can draw, but with the regulatory regime. I was amazed to find that, once people have taken a draw-down at 65, they cannot change the fund manager for 10 years. That is utterly against the spirit of the Government's stakeholder pension proposals and is quite inappropriate.
I do not know their validity, but I note that surveys show that about 98 per cent. of people approaching 75 who are required to purchase annuities seem to be unhappy about that. That issue came on to the screen in a modest way, but is now important. I suggest that citizens understand the problems and that forcing people into relying wholly on fixed-income securities for 10 or 15 years of retirement when long gilt yields have fallen below 5 per cent. and inflation is artificially low is a bad risk-return mix, even though their pots may have benefited a little from that. They know that that is not a wise use of their pension savings and they are becoming increasingly annoyed that they have to do it.
For the reasons outlined by the hon. Member for Northavon, I think that the Revenue and the Department of Social Security have been extremely reactionary. I consider the Revenue's arguments to be completely bogus. It will probably get more tax under draw-down; if the investments do that much better and if the income averages more than that under an annuity over the period of retirement, it will get the tax on that and on the lump sum at the end. It is likely to do better as a result of more flexibility.
If the Revenue argues that the timing of the cash flow is painful, the 35 per cent. tax on any sum that is left over could be increased to 40 per cent. That would not make

much difference. If there is a statistical cash flow argument, it can be addressed. Whenever I read its arguments I think of Messrs Slow and Bideawhile because they represent bureaucratic obfuscation and thinking that comes from the 1920s, not from today. There has to be one or other method for the Revenue to satisfy itself that it is getting its fair tax take.
Another great argument is cited: "Ah, but we must do everything to make sure that people do not blow it all and then come on the state. People are living much longer." My response is twofold. First, if the Labour Government feel so strongly about that, it is rather strange that they have put in place a massive incentive for people not to save, not to accumulate pensions and to become dependent on the state. The pension top-up, with its link to earnings rather than to inflation, is a generous incentive to come on to the state for people who have either managed to avoid getting locked into a pension scheme or have done the very minimum. It is strange that the Government are providing a huge incentive to do something that they describe as profligate.
Secondly, we should look at behaviour. Any Member of Parliament with parents knows that people become more and more cautious with their money as they get older. Often, the problem is getting relatives to spend their money and have a decent standard of living. I have never seen a profligate 79-year-old burning up the town. I am sure that there must be one or two, but it is entirely false and unrealistic to assert that all those people over 75 will blow the lot as soon as they get the green light. Under present draw-down arrangements, they cannot do that.
I am increasingly coming to the view that even draw-down arrangements should be more flexible and more liberal. South Africa has providence scheme pension arrangements. People get their money and they can do what they want with it. Interestingly, most buy flexible equity-linked annuities, because all the administration is done for them, and time-termed annuities, which are still a useful instrument. There is no evidence, even in a country with a much lower standard of education than ours, that the money gets blown. South Africa has put in place a modest state old-age pension for those who have no other provision, so it has the moral hazard issue about which the Government—I think somewhat bogusly—are so concerned.
There is a big issue to be addressed, purely from the angles that I referred to at the beginning of my speech. If nothing is done, and if we still have a balanced budget, a huge and growing volume of people with money-purchase pensions will be condemned to buying gilt-based annuities. That will give them a very poor deal. Real yields will be extremely low and no pension fund manager would argue that the risk-reward mix was right. We need imaginative, radical thinking about restructuring the whole area.
I very much hope that the investigation by the Revenue, which the Government are using as a stalling mechanism to avoid answering the questions, will not be a pathetic fudge and a minor change to the draw-down regime. What is required here is a radical, rational reform based on what works in America, parts of Asia and other parts of the world. Pressure for that reform is coming from voters of all political shades. I believe that the Minister has had many letters from his constituents, so he knows how people feel about this matter. It should not be a


cross-party issue; it is something that the people of our country want, and I hope that the Government will get a move on with it.

Sir Robert Smith: I echo what the hon. Member for Arundel and South Downs (Mr. Flight) said: the review should be wide ranging and constructive. In introducing the debate, my hon. Friend the Member for Northavon (Mr. Webb) talked about the Government being the bad guy. I think that he meant Government with a capital G—

Mr. Webb: No.

Sir Robert Smith: Well, perhaps the bad guy does not yet have a political label, but the political label will stick to the bad guy if the Government do not produce something constructive and far reaching out of the review.
I thank my hon. Friend the Member for securing this useful debate. The three speeches that we have heard so far will help me to explain the matter to my constituents and to help them see that there is a way forward. All three of the previous speakers hinted to the Government that they can proceed constructively by recognising that the elderly are not profligate and want to make effective provision for their retirement. The Government must realise that the nearer people get to retirement, the more nervous and cautious they become about their financial position. Although this problem may not arise until they reach the age of 75, people who are only approaching retirement phone me up in my constituency surgery because they read in the papers that financial analysis shows that the problem will not go away.
The gilt market is changing. As the hon. Member for Arundel and South Downs said, it could change even more dramatically if the Government achieve their claimed economic objective. That worry hangs over people. They should be able to relax and enjoy their retirement, having made reasonable financial provision, but, instead, they are uncertain about their future. An extremely strict set of rules is making it difficult for people to see how they can proceed in a flexible way. I hope that the Minister understands that concern and accepts the need to tackle the problem.
I have always worried when I see new products or new tax systems being introduced to encourage people down certain savings routes. New products are marketed effectively in terms of attracting people down certain tax routes to encourage them to save, but if one does the arithmetic, one finds that charges eat up most of that benefit. Moreover, by tempting people into various ways to save, one distorts the market. As has already been said, much of what should go to savers is taken away in fees, which are hidden in the whole investment structure. Thus, clarity and information are needed, as was said in Monday's debate on the regulation of the financial services industry.
As my hon. Friend the Member for Northavon said in an intervention on the hon. Member for Arundel and South Downs, we must ensure that people are informed about their right to sell insurance policies rather than cash them in. Apparently, there is a requirement that information should be provided, but it is not provided in a way that gets through to people. Many people make

extremely bad financial decisions and one sometimes wonders why they ever considered them in the first place, yet they do so in their droves. Therefore, the market is clearly not working efficiently and effectively. As other hon. Members have said, products need to be competitive and people need to know that they can switch supplier, which is an effective way of ensuring a better return on an investment.
The Government must accept that this is not a temporary problem. They must also accept that the new structure of the economy that they have created means that we need new solutions. Even inflation at 1.5 to 2 per cent. amounts to a lot of inflation over someone's lifetime. In planning for their future, people must take into account the fact that investments are eaten away even by low inflation.
The purpose of this debate was to encourage the Government to look at the review and see that it is wide ranging. It is a real problem for many investors, but the potential for solutions exists.

Mr. Webb: My hon. Friend mentioned the effect of inflation. Will he reflect on the fact that, at 2 or 3 per cent. inflation, after a decade, people's investments are down by a quarter? If people retire at 60 and live to 80 and beyond, the oldest pensioners will be by far the poorest. Does my hon. Friend think that any policy implications follow from that?

Sir Robert Smith: The Minister will recognise that Liberal Democrat policy is immediately to tackle the problem of pensions for the elderly by providing a narrowly targeted benefit. Given the historical provisions that were made, the oldest pensioners are the poorest. By tackling that problem now, the Government could provide immediate relief for those who cannot provide a solution for themselves—they cannot go back and rearrange their financial affairs.
When constituents first brought this problem to my attention, they wondered whether there was a magic solution somewhere in Europe, which has had a culture of low inflation. Before this debate, I was discussing with colleagues whether they would welcome a helpful intervention suggesting that we look in that direction. I was advised that pensions provision in Europe is a bit of a scandal—

Mr. Flight: Like everything else.

Sir Robert Smith: I would not go quite as far as that.
In Europe, the unfunded state system has provided people with a security blanket and they have not needed to get involved with products that deal with a low-inflation market with long-term benefits for pensioners.
This debate has given the Minister some useful meat from which to come up with some effective solutions. If he does not do so, the "bad guy" label will stick to the Government.

Mr. Michael Trend: First, I congratulate the hon. Member for Northavon (Mr. Webb) on securing the debate. It is clear, however, that the Liberal Democrat party has seen the bandwagon roll past it in the past few weeks and it is making a desperate scramble to board it.


The campaign to scrap the compulsory purchase of annuities has been driven by the Conservatives, particularly my hon. Friend the Member for Arundel and South Downs (Mr. Flight), who spoke so well today. It is our clear view that the requirement to buy an annuity at the age of 75 should be abolished.

Sir Robert Smith: The hon. Gentleman should be careful when talking about bandwagons. The Liberal Democrat bandwagon in this debate consists of three Members, whereas the Conservative bandwagon consists of only two.

Mr. Trend: I do not need to remind the House that this is a Liberal Democrat debate. I notice that no Labour Member has spoken—let alone spoken with enthusiasm—in the Minister's welfare reform week, which is supposed to be so important but which is going like a damp squib.
The Government should act without delay because, with every day that passes, large numbers of people who have worked hard all their lives to save for their old age are seeing their efforts cast back in their faces. We are told that the Government have asked the Inland Revenue to consider the matter, but the Government cannot continue to hide behind such obvious delaying tactics. The growing sense of unfairness with the current compulsory system has been looming on the radar ever since the Government came to power. The fact that people are now really hurting and are complaining vociferously to their Members of Parliament about their predicament shows that the Government have already left it too late to make an appropriate change to the law. They must act now.
May I give the House a flavour of the sort of correspondence that Members of Parliament are receiving? One person has written:
I have saved long and hard so that I would not suffer financially in my dotage and the value of my pension pot is worth even more than the value of my house. I resent very much now that I made this great effort only to find that, even with the addition of my state pension, I still fall short of the amount that is considered to give one an adequate lifestyle in retirement.… It is unacceptable to have absolutely no control over what is probably the largest amount of money that most people will have in their lifetime at a time when it is giving the lowest return.
We have heard many arguments about taxation. There are various ways in which the Revenue and the clever people at the Treasury could work out a compensating scheme for the Government. It has been suggested that people could be required to keep in a conventional annuity enough to cover at least the level of the minimum income guarantee. There must be dozens of other ways of achieving the aim, but my correspondent says:
I would be quite willing to pay a lump sum to the Government equal to the income tax allowance made to me while accruing my pension if I could have the freedom to do what I wanted with the capital.
I am not sure that I would be prepared to do that, but it is another suggestion made by one individual who feels desperate enough to put such a deal to the Government.
All hon. Members who have spoken have said that the Government fear that people might go in for high living. My correspondent says:
The Government may fear that some would go out and buy, say, a Ferrari with the money and then fall back on the state to support them. However"—
this is the key point—
people who take the matter of their retirement seriously and save for it are hardly likely to do this.
We all agree that annuities involve a balance of risk. The choice of schemes for pensioners is wide and, to many, it must seem bewildering. Should they buy a fixed annuity or one that increases from a lower level of initial payment? Should it be linked to the retail prices index? Should it be a joint survivor annuity so that their spouse will benefit after their death? Should they opt for a guaranteed minimum length of payment? Should the annuity be "with proportion" or "capital protected"? Should they take the income in arrears or in advance? How often do they want payments?
The central point about the current position, which others have made, is that the current rates are low. The Association of Unit Trusts and Investment Funds paper, which has already been referred to, says that a man aged 65 with a pot of £100,000 could reasonably expect to get a guaranteed five-year fixed annuity with no escalation of about £9,000. A guaranteed five-year annuity with 5 per cent. escalation would be about £6,000. A guaranteed five-year annuity index-linked to the retail prices index would be about £6,500. That compares with a figure seven years ago of between £15,000 and £16,000. The drop has been substantial and must be very scary to people coming up to making such difficult choices about what sort of annuity to opt for.
Behind all the complicated choices and the consequences that flow from them there are two fundamental uncertainties: first, how long a person is likely to live; and secondly, what is going to happen to long-term gilt redemption yields. An individual could answer all the questions that I asked earlier in the most intelligent and appropriate way, sign up for an annuity on a Monday and die on the Tuesday. That would be bad luck, but there is nothing to be done about it. On the other hand, a life company could offer very generous payments to a heavy-smoking, heavy-drinking, overeating, never-exercising, highly nervous elderly man who then lives for decades. There is nothing that the company can do about that. An annuity is for life. Jane Austen rightly said that it was "a very serious business".
I want to speak up for the annuity. Somehow, its popularity, based on the conversion of capital to income guaranteed for the full term of life, has persisted down the centuries that divide us from Miss Austen's world. For those able to save money for their retirement—thankfully, that is now a large number of people—the annuity continues to be a popular choice. At an important level, annuities are regarded as the fairest way of sharing the risks of our mortality.
As the hon. Member for Northavon said, it is most interesting that, despite the wide range of annuities on offer today, and despite the actuarial information that


should help people to make the right choice, the industry average for those who buy level-term annuities is 83 per cent. The AUTIF document refers to an office that surveyed people about to retire
and found that most wished to buy an escalating annuity because they thought it was sensible to provide for future rises in the cost of living. But when it came to the actual purchase, the vast majority opted for a level term annuity.
Level-term annuities are popular because they answer an important psychological need, as well as giving people the guarantees that they require at that age.
There is a third party in the deal between the individual and the life company—the Government. The Government have obvious tax interests, but they must not be allowed to override other interests. The Government are also the final regulator of the balance of risk between the individual and the life company. A key Government responsibility is to ensure that the means of saving and providing income for oneself continues to be seen as a fair and reasonable way of sharing risk. As long as all those involved in the long chain from the young saver to the elderly pensioner retain a sense that the system is broadly fair, there is every reason to believe that the annuity will remain a popular means of providing for oneself.
I ask the Minister to imagine what it must feel like to be a 73 or 74-year-old who, through their own hard work, has saved tens of thousands of pounds for their old age. As the long-term gilt redemption yields have declined, that individual will have noticed that the cost of annuities has roughly doubled over recent years. They will get about half as much to live on as someone who saved the same amount and retired a few years ago. Their prospects will be substantially bleaker than they might reasonably have expected. Someone in that position knows that they are going to get a bad deal. They have done everything that successive Governments have urged them to do, passing over some of the pleasures of life to be able to stand on their own two feet in retirement, but the system has stuffed them. The Government control the system.
The fact that one group of pensioners who have worked hard and saved hard are getting a bad deal because they are being forced through no fault of their own to take out annuities erodes general confidence in the system. The Government cannot want that. Let us charitably assume that, one day, the Government sort out their muddle on stakeholder pensions. What if the dark cloud surrounding compulsory annuities rains down on that pet scheme? The previous Government saw how annuity rates were going and changed the law in 1995 to allow income to be drawn down directly from the pension fund until the pensioner reaches the age of 75. Enabling pensioners to defer the purchase of an annuity for 10 years or more was a sensible and popular measure. New financial products were developed to offer better choices to pensioners.
However, the problem facing those coming up to 75 is now substantially worse than that which faced the earlier generation. Government policy must respond and develop. The previous Government acted to ensure the basic sense of fairness in the system. Those who have waited may well have been gambling on a rise in annuity rates, but that gamble has clearly not paid off. They, and a new generation facing this area of difficulty for the first time, are looking to the Government to remove the age limit. We are asking for greater flexibility, so that people coming up to 75 can make their own informed decisions.

The Government should at once free people from any artificial, arbitrary, unfair restrictions and let responsible people make their own decisions.

The Minister of State, Department of Social Security (Mr. Stephen Timms): I welcome the debate and congratulate the hon. Member for Northavon (Mr. Webb), as others have done, on his success in securing it. The issue is important and, as several hon. Members have pointed out, it is attracting a great deal of attention at the moment. I also welcome the hon. Member for Windsor (Mr. Trend) to his place, and congratulate him on his appointment. I know that he will not take it amiss if I tell him that we shall miss the energy and vigour that his predecessor, the hon. Member for Grantham and Stamford (Mr. Davies), brought to our debates on such matters—but that, if he does not match him in terms of the length of his contributions, there will be no complaints from us on that score.
I also congratulate the hon. Member for Windsor on the fact that he has been able to make a policy announcement in his first contribution in his new role. Indeed, I have here the Conservatives' press release of yesterday announcing that, as the hon. Gentleman has told us, they intend to scrap the requirement.
It is not entirely clear to me, either from the press release or from what the hon. Gentleman said today, whether the Conservative proposal is to change the age from 75 or to abolish the necessity to take out an annuity at any stage. I must add that the outrage that he has expressed about the unfairness of it all would be a little more convincing if it were not for the fact, which he mentioned towards the end of his speech, that it was a Conservative Government who introduced the requirement in the first place. No doubt, I shall come back to some of those points in due course.
Let me reassure the hon. Member for Twickenham (Dr. Cable)—I have not consulted the 1888 report to find inspiration for what I have to say to the House this morning. I pay tribute to the expertise in these rather arcane matters that has been shown by everyone who has contributed to the debate so far.
First, I shall say something about the reformed structure that we are introducing for the pensions system, so as to provide background to the concerns that have been expressed about annuities. There is a pressing case for reform. It is true that pensioner incomes have grown faster than working incomes over the past 20 years, mainly as a result of the success of occupational pensions—but that overall average picture masks the fact that a significant number of older people have been left behind by the improvements that others have enjoyed. Some pensioners have prospered; others have not. That is why it is important to give priority to extra help for those who need it most urgently.
Every pensioner household will benefit from the £4 billion package that we have introduced for the life of this Parliament, but the lion's share of the extra money will be aimed at the least well-off. Through the minimum income guarantee, which several hon. Members have mentioned, pensioners receiving income support are now at least £160 a year better off than they were before April.
Next April, the guaranteed level will increase in line with earnings, which will bring another 20,000 pensioners within the minimum income guarantee. As we aim,


in time, to uprate that guarantee in line with earnings, those whose income is just above the guarantee—a group often of particular concern, rightly so, both to hon. Members and to their constituents—will gradually be brought within its scope as its level rises. After next April's increase, a pensioner couple over 80 will be about £8 a week better off in real terms as a result of the changes that have been made since last year.
That is a substantial boost, and we can give it because we are ensuring that the extra money is available to those who need help most. The hon. Member for Arundel and South Downs (Mr. Flight), who is not in his place at the moment, described that as an extremely generous arrangement; I am not sure that I would go quite so far as that, but it represents a great improvement for the people who, rightly, look to the Government to provide improvements.
In addition, in the winter, every pensioner household will receive a £100 payment towards the cost of fuel, which will benefit about 10 million pensioners in more than 7 million households. The minimum tax guarantee, with additional uprating of pensioners' personal income tax allowances, means that, since the Budget, 200,000 pensioners have been taken out of income tax for the first time. Two thirds of pensioners now have no tax to pay.
A range of substantial changes have therefore already been made. Looking to the future, our election manifesto recognised that we need major reforms to ensure that future generations of pensioners can look forward to a decent retirement. Our review led to the Green Paper on pensions, published just before Christmas.
Everybody who can save for retirement has a responsibility to do so; in turn, the Government have a responsibility to provide security in retirement for those who cannot save enough, and to regulate effectively the private pensions system—an aspect of which is the focus of our discussion this morning.
Our strategy for the future, as laid out in the Green Paper, rests on four interlinked pillars. The first is the basic state pension, uprated at least in line with prices each year. That will not be means-tested or privatised. The second is the minimum income guarantee, which I have described.
The third pillar is the state second pension, and the fourth is our new funded stakeholder pension. The new state second pension is being designed to ensure that, in future, everybody with a lifetime of work and contributions behind them will build up a right to a pension that will be above the minimum income guarantee when they retire. In due course, we expect that pension to become a flat-rate scheme for those on lower earnings, with moderate and higher earners contracted out into funded pensions.
The fourth pillar—the stakeholder funded pension—will be a new type of private provision, combining the low overheads and high security that characterise occupational pensions with the flexibility of the best personal pensions. Those are being designed particularly to help those on middle incomes, from roughly £9,000 a year up to average earnings. However, they will benefit those on higher incomes as well.

Mr. Trend: With regard to both pensions in general and stakeholder pensions in particular, the Minister's

document, released yesterday, did not seem to say anything about the costs, which were supposed to be 1 per cent. In the light of that paper, and of other consideration that the Government are undertaking, can he tell us whether he still expects the costs to be that low, or whether they will be higher?

Mr. Timms: We are issuing a series of consultation briefs about the design of stakeholder pensions. The first, issued on 2 June, was about minimum standards, including costs. We are consulting on the view that we expressed in that paper. As the hon. Gentleman rightly says, another document was issued yesterday, about employer access to stakeholder pensions. Our aim is that every employee in the land who does not have access to an occupational pension scheme should have access to a stakeholder pension in the future.
The hon. Gentleman is right to say that we did not revisit the subjects covered in the paper of 2 June, but that is because the subject matter of the next document was different. Four further consultation briefs will be published before the end of July, and will cover the full range of the decisions that need to be made about the details of stakeholder pensions.
We are driving a hard bargain on behalf of scheme members with our proposal for a 1 per cent. charge. We think that that is right, and that the Government and the industry need to work hard on stakeholder pensions to persuade people whose main knowledge of personal pensions is that they were mis-sold to lots of people in the past, that stakeholder pensions will be dependable, good value, and a good place to invest their savings.
That is the basis for the view that we expressed on 2 June. I have been heartened by the positive response to that proposal so far. We are considering the matter and consulting, and we shall listen carefully to what everybody says. The proposal has lit a spark of enthusiasm about stakeholder pensions.
The Welfare Reform and Pensions Bill sets out the basic legislative framework for stakeholder pensions. There will be a series of documents between now and July about the detail. We have a structure for pensions reform that is well thought through and has been widely welcomed. There has been lots of comment about the detail, and our task now is to get that right.
I readily acknowledge the widespread concerns about the requirement to annuitise a personal pension or a money purchase occupational pension arrangement. I have received numerous letters from hon. Members and constituents. The hon. Member for Arundel and South Downs said that I must have received many letters from my constituents, but in fact I have probably received more from his constituents, via him. Several hon. Members have also tabled parliamentary questions on the matter, and I have had discussions with both them and the pensions industry.
The present position is that members of a personal pension scheme must use their fund to buy an annuity by the time that they reach the age of 75, and—this has not been mentioned today—members of money purchase occupational pension schemes must buy an annuity when they retire. Before reaching 75, but after the age of 50, holders of personal pensions may draw income directly from their fund, subject to upper and lower limits. We have already had some discussion about income


draw-down. We plan to introduce parallel arrangements for members of money purchase occupational schemes shortly.
The current arrangements for annuity deferral until 75 have been in place for three years, as the hon. Member for Windsor said. The Inland Revenue is conducting a review of how well the arrangements are operating and will assess the need for any changes later in the year. The review is considering annuitisation by 75. I reassure the hon. Member for Arundel and South Downs that it will be a wide and thorough review, and not the pathetic fudge that he feared. The results will be published in the autumn.
The rate for a level annuity has fallen sharply over the past five years. Apart from the change to a low inflation environment, people live about 10 years longer than they did 50 years ago, and there have been sharp increases in longevity in the past few years. That continuing trend clearly affects the annuity rates that can be offered, as the fund will have to cover a greater number of years in retirement.
Before writing off annuities, we should consider the whole story. I have some sympathy with the points made by the hon. Member for Windsor on the subject, although he seemed to be arguing both ways. He said that he was in favour of annuities and then said that people who had to buy them were getting a terrible deal. We must ensure that we do not encourage the view that taking out an annuity means bad value, which is often not the case.

Mr. Webb: I was not remotely attempting to write off annuities, although they may not be appropriate for everyone. We are in favour of choice. People of 75 who are allowed to continue with draw-down and to keep a capital sum might be better placed to pay for their own long-term care, whereas those who buy an annuity get a pension stream that will never cover long-term care costs. Might that be another attraction for the Government of more flexibility?

Mr. Timms: That is an interesting point. As the hon. Gentleman knows, we are considering the arrangements for long-term care and will make an announcement in due course. There are attractions in various forms of flexibility that are not currently available and we need to keep an open mind. Throughout this debate, hon. Members have been asking for greater flexibility, and no one has suggested that there is a panacea that would allow us to convert a lump sum pension pot into an income stream to support people through their retirement.
The current arrangements are easy to criticise, but it is hard to come up with genuinely radical alternatives. There is certainly scope for discussing the details and whether it might be appropriate to have extra elements of flexibility. The great virtue of an annuity is that it provides a guaranteed income for the remainder of a person's life, however long that turns out to be. That is an important virtue.
It has been suggested this morning that it is rather patronising to be concerned that people will blow their savings on a Ferrari when they retire. Whatever the other considerations, the Government would need to think long and hard before signing up to an arrangement that could lead to people facing a sudden financial crisis in their 80s or 90s. I have seen some suggestions for alternatives that are quite open about the fact that they run out after

25 years, on the ground that most people do not live longer than that after retirement, but it would be wrong to go down a route that could lead to a crisis for people at exactly the time in their life when they would least want to be confronted with one.
Annuity rates have fallen, but so has inflation. Lower inflation means that the purchasing power of a fixed-value annuity is now maintained much better than it was in the past. The rates for index-linked annuities are especially interesting. Five years ago, an indexed annuity would have produced an annual pension, for a man aged 65, of £6,600 from a fund of £100,000. The comparable figure today is about £5,800: a reduction of only £800 a year and a much smaller fall than that in the rate of level annuities.
That comparison is instructive and it is as well to bear those figures in mind in considering whether the value offered by annuities is significantly worse today than it was five years ago. The evidence does not support that thesis. Over the same period, people's pension funds have enjoyed the benefit of substantial stock market growth, and fund growth has helped to mitigate the effects of the fall in annuity rates.
The open market option for holders of personal pensions means that fundholders can shop around.

Sir Robert Smith: People nearing retirement will not have had the full benefit of stock market growth, because their fund should have been managed in recognition of their age.

Mr. Timms: That is a fair point, but, if one compares the past 10 years with the previous 30, it is clear that returns on equities have been very much better.
Life offices that act as annuity providers have a very good track record for security. There has been no significant failure associated with them, owing to the underwriting process that secures the payment to an annuitant so that the liability is matched to suitable assets. That feature, guaranteeing income, is the real strength of the annuity system.
There are already forms of annuity, such as with-profits annuities, that allow pensioners to share in equity growth; but that inevitably exposes the pensioner to increased risk. The hon. Member for Arundel and South Downs suggested that those were not widely taken up because of Inland Revenue rules. I do not agree. I think that it is the inevitable risk that has deterred people. They are available as an option for those who want them.
We have considered whether there is a viable alternative to annuity purchase that would guarantee income for the rest of the annuitant's life, but none has so far been identified. The Treasury is open to suggestions from the industry.
The value offered by annuities is not as poor as is often suggested. I have seen no evidence that the providers of annuities are making exceptional profits, which they would be if some of the criticisms that have been levelled at them were valid.
Stakeholder pensions are identified in the Welfare Reform and Pensions Bill as money purchase schemes. I want stakeholder pensions to enjoy—

Mr. Deputy Speaker (Mr. Michael Lord): Order. It is time for the next debate.

Areas of Outstanding Natural Beauty

11 am

Mr. Martin Caton: In 1949, a Labour Government gave us the National Parks and Access to the Countryside Act, which established national parks with the twin purposes of promoting their conservation and public enjoyment. It also established areas of outstanding natural beauty, where the objective was landscape conservation. I hope that today's debate—50 years after passage of the legislation—will allow us to celebrate our designated areas of outstanding natural beauty in England and Wales. I also hope, however, that we will not be afraid to focus on the weaknesses that have been exposed in the legislation over the past half century, or to consider how, in the years ahead, we might improve the protection of some of our most precious landscapes and habitats.
The designation "area of outstanding natural beauty" was created by section 87 of the 1949 Act. The first thing that we can celebrate is the very fact that that Government, in that legislation, recognised the need to maintain our most beautiful countryside as places in which to work, to live and to play while protecting its special qualities.
We can still, 50 years later, rejoice in the title of areas of outstanding natural beauty, as it tells us what we are talking about: some of the finest landscape and most environmentally important countryside in the whole of England and Wales. Although we might quibble about whether the countryside that we are talking about is truly natural, for most people the title communicates very well what we are trying to say, and does so far better than titles such as national park, nature reserve, site of special scientific interest, special area for conservation or special protection areas.
Unfortunately, it could also be argued that creating the title AONB was almost all the legislation did. The legislation called for designation of parts of our countryside as outstanding, and, in the title, explained why they should be so designated. To be fair, I should add that the Act also made provision for land-use planning arrangements, which, although possibly imperfect, have helped enormously in protecting those special places.
The Act did not provide for the administration of AONBs. It said that they should exist and why, but did not say anything about how—how they were to be managed—or about who was to manage them or to finance that management. That contrasts with the situation of national parks, which were created in the same legislation. Questions of who and how in relation to national parks were answered fairly clearly in the 1949 Act, and were further dealt with in the Environment Act 1995.
The failure to make provision for positive management of AONBs was not an error, but was a result of the thinking of that time—particularly in the Hobhouse committee's 1947 report, which led to the legislation and which stated:
There are many areas of fine country in England and Wales which are not included in our selection of national parks but yet possess outstanding landscape beauty, are often of great scientific interest and in many cases include important holiday areas. While in the main they do not call for the degree of positive management required in National Parks…their contribution to the wider enjoyment of the countryside is so important that special measures should be taken to preserve their natural beauty and interest.

We recommend, therefore, that the Minister of Town and Country Planning should designate areas of high landscape quality, scientific interest and recreational value as Conservation Areas.
In the 1949 Act, those conservation areas became AONBs. I suspect that, even then, the belief that those areas did not require positive management was mistaken. Consequently, the need for such management has become ever clearer.
Perhaps, 50 years after passage of the Act, the most remarkable feature of our AONBs is how much has been built on such a flimsy foundation. I hope that colleagues on both sides of the House who represent constituencies that include AONBs, or parts of them, will take this opportunity to talk about what is happening—for good or ill—on their patch, to help Ministers as they assess the best way forward for landscape protection in those very special areas.
I should like—to set the ball rolling—to talk briefly about the AONB in my own constituency of Gower, to demonstrate not only some real achievements but some failings that were partly caused by the omission in the 1949 Act.
The fact is that the Gower peninsula itself set the ball rolling. In 1956, it became our first designated area of outstanding natural beauty, in recognition of the national importance of its landscape, particularly its coastal landscape, and its wildlife and clear historical identity. It began the process of AONB recognition across England and Wales.
For many years before designation, Gower had, quite rightly, been appreciated for its special qualities. Its complex geology produces a wide range of scenery in a comparatively small area. It ranges from the south coast's superb limestone cliffs and broad sandy beaches, to the salt marshes and sand dune systems in the north. Inland, large areas of common land—dominated by sandstone heath ridges—are a feature, and its rich natural environment of heath, grassland, fresh and salt water marsh, dunes and oak woodland were nationally renowned even before the war. That was reflected, from 1933 onwards, in a number of early acquisitions by the National Trust.
Nevertheless, it took some intense lobbying before, on 9 May 1956, L. Strang, chairman of the National Parks Commission, and his secretary, Harold Abrahams, signed the designation order. The designation has been a matter of pride for Gower residents ever since. However, even in 1956, Gower people were worried about the availability of resources, after designation, for maintenance and improvement of the environment in their area.
At the time, the then National Parks Commission proposed an extensive series of grants for landscape management. The proposal, however, was never implemented, so that the burden of providing resources for conservation of that nationally important area has fallen on local authorities, sometimes with the help of partner agencies. In fact, the nearest that we have come to putting into practice the National Parks Commission's 1956 idea occurred in the 1990s, under the Tir Cymen agri-environment scheme, in which Gower was a pilot area. The scheme enabled some very valuable environmental improvement work and enthused our local farmers. I hope that the scheme's replacement, Tir Gofal, will build on the earlier experiment's achievements.
Since 1956, it has been mostly up to local councils to try to protect the Gower AONB as best they could. However, with no statutory requirement for positive


management, the record has been patchy. For example, in the 1960s, an AONB warden was appointed to implement small-scale projects and to patrol the area, but to do so without an overall strategic plan. When the warden retired in the early 1970s, his post lapsed.
Similarly, in 1973, when the importance of Gower's unspoilt coastline was recognised by its designation as a heritage coast, a heritage coast warden was appointed by the city council, and several initiatives on various degraded sand dune systems were implemented. However, there was no heritage coast management plan, and no links to wider AONB work. When the heritage warden retired, he, too, was not replaced. Time was lost, and, with it, stone walls, traditional boundary hedges, stone-faced banks, old barns and goodness knows what coastal and inland wildlife habitats also were lost.
Only in the 1990s, with publication of the Gower management plan and appointment of AONB staff, did conservation really move forward. Now, we have integration and co-ordination of the work of the agencies involved in countryside management in the AONB. However, a real threat is still posed by the absence of core funding and statutory responsibility. Gower AONB' s long-term protection is still by no means guaranteed.
I believe that the situation at the Gower AONB is similar to that of AONBs across the country. There are now 36 areas of outstanding natural beauty in England, and four such areas in Wales. Additionally, a large part of the Wye valley AONB is in England, with a smaller part of it in Wales.
All 41 AONBs, with our national parks, represent the finest landscapes in our country and are an absolutely vital part of our national heritage. They range from the Solway coast to the north Wessex downs; from the Norfolk coast to the Cotswolds; from the Cornish coast to the Clwydian range. Their beauty is matched only by their wonderful variety.
As I have mentioned national parks, I should affirm that AONBs are not second-class national parks, but are equal in quality. They are distinguished from the latter in the legislation on the basis of access for extensive outdoor recreation, not on the basis of beauty or ecology. However, although AONBs are equal in beauty and environmental quality, they are not equal in treatment.
National parks have authorities to manage their protection and public enjoyment. They also enjoy a high profile and guaranteed funding, which is not true of AONBs. Although AONBs often have to deal with national-park scale problems, they do so without resources that are anywhere close to those available to national parks. For instance, the Cotswolds, at 2,038 sq km, is much larger than the national parks, and the Chilterns, with 52 million day visitors a year, receives more visitors than most national parks in any year. Can it be right that the law fails to provide that those special areas must be managed to protect them, fails to identify anyone to do the job, and fails to provide for resourcing the work?
Even now, when, thanks to local initiative, a lot of good work is being done, 13 of the 37 AONBs in England have no management plan in place. Some have not appointed an AONB officer, or set up a joint advisory committee. With no statutory requirement and no long-term funding, that is hardly surprising. As an aside, I should tell the House that we in Wales do not even have the benefit of additional financial resources directed to the English AONBs as an interim measure.
The Countryside Agency submitted advice to the Government on the future of AONBs last June. The Countryside Council for Wales followed, with a similar submission to the Welsh Office in January. Both organisations expressed concern about the increasing pressures of modern society on our vulnerable high-quality country areas, and about the threat from changing farming economies to our treasured landscapes.
The Countryside Agency made specific recommendations to ensure effective management, adequate financial provision and improved development controls in our AONBs. It calls on the Government to give a lead in their planning decisions to demonstrate the very high degree of protection that AONBs should enjoy. It calls for a statutory obligation on all public bodies to have regard to the need to enhance the natural beauty of AONBs. It calls for highway authorities and the Highways Agency to act on their duty to have regard to the purposes of the designation of protected countryside, and suggests the use of transport policy and programmes to channel funds into schemes that protect our finest countryside.
The agency argues that agri-environment schemes should cover all farm land in national parks and AONBs. It calls for Government funds to cover the costs of management services for visitors and recreation in designated areas, and suggests that this funding be supplemented by lottery and European Union finance. It calls for local authorities to be statutorily required to pursue the objective for which AONBs were designated, and to produce AONB management plans.
The agency argues that local authorities, when they so wish, should be able to constitute conservation boards, with—as a minimum—consultee rights on planning matters, recreation and agricultural policies in their AONB. It calls for Government funding of the core costs of managing AONBs through a 50 per cent. grant. As a matter of interest, the Countryside Council for Wales argues that the grant should be 75 per cent., to give parity with national parks. Finally, the advice calls for Government finance for an AONB fund for special projects.
I know that the Government are considering the Countryside Agency's advice, but they have been doing so for 12 months now. At different times since last June, we have been told that the Government would respond soon, and then very soon. When my hon. Friend the Minister winds up, I hope that he might be able to be rather more specific as to when we can expect that response. However, if he could manage a phrase such as "very, very soon", or "very, very soon indeed", I would regard that as at least a step in the right direction.

Sir Geoffrey Johnson Smith: I do not want to make a speech and intrude on the time available to the hon. Gentleman, as, unfortunately, another engagement means that I cannot stay for the rest of the debate. However, on this specific point, may I say how much I welcome what he has said? The Sussex downs conservation board is seeking increased powers along the lines suggested by the hon. Gentleman. My constituency contains an AONB, and the Sussex downs can be seen in the distance. What the hon. Gentleman has said should


command wide support in the House, and I hope that a favourable response from the Government will not be too long in coming.

Mr. Caton: I thank the right hon. Member for that intervention, which fits nicely with what I have to say. I was about to refer to the private Member's Bill, the Areas of Outstanding Natural Beauty Bill, being introduced by Lord Renton of Mount Harry in the other place. Lord Renton is the chairman of the conservation board mentioned by the right hon. Gentleman, and that board is setting a good example for a possible way forward.
I know that I am not allowed to request legislation in this debate, and I do not intend to do so, but I have read the Hansard report of the Second Reading debate on Lord Renton's Bill in the other place. It was quite a literary debate, with quotes from John Keats, Rudyard Kipling, A. P. Herbert and even Bill Bryson, and it helped to clarify the matters that need to be addressed. It identified some key questions, which I shall list and to which I hope my hon. Friend the Minister will respond.
Are we going to be able to conserve our AONBs in the future without placing a statutory duty on local authorities? How can we make sure that all public bodies recognise and respond to the AONB designation in carrying out their functions in these areas? How do we ensure that every AONB in the country is positively managed, so that these landscapes and habitats can be properly protected in the face of increasing pressures?
How do we resource that management and the special enhancement and conservation projects that will come out of it? How do we ensure a cohesive approach to AONB management, when the AONB in question straddles two or more local authority areas? Can we justify the differences in levels of protection offered to AONBs as compared with national parks, when we know that they are equal in terms of landscape quality?
On Monday, my right hon. Friends the Deputy Prime Minister and the Minister for the Environment launched the new Countryside Agency. Quite rightly, the former pointed to the actions that this Government have already taken to improve the quality of life in our rural areas and to protect our environment. He stressed his determination to do more.
I know that the Minister is committed to the cause of conservation and, especially, to the protection of our finest landscapes. I hope that he will be able to address the questions that I have just asked, and outline Government thinking about protecting that invaluable resource—the 16 per cent. of our country designated as being of outstanding natural beauty.
The AONB designation applies nationally. Its purpose is to conserve the most important landscape heritage of the nation for the benefit of this and future generations. It is about long-term stewardship for the conservation of natural beauty, and it includes the protection of flora and fauna. Geological features, as well as important features of the landscape, archaeology and history, are also covered. When AONBs are working at their best, these national objectives are achieved through partnership with local communities. That is what we must build on.
I noticed that the press release for Monday's launch of the Countryside Agency was entitled "Everyone's a Winner in Tomorrow's Countryside". I believe that we will all be winners if we get the future of our AONBs right.
In this debate, we can celebrate the 50th anniversary of the 1949 Act. Despite its flaws, it was a landmark piece of legislation about how we live, work and play in the most beautiful parts of England and Wales and, at the same time, conserve their special qualities. Now, however, we need to ask whether it is time to create a new framework for areas of outstanding natural beauty for the new century—a framework for better management and fairer resourcing.

Mr. Tom Brake: First, I congratulate the hon. Member for Gower (Mr. Caton) on securing a debate on such an important issue. He is privileged to represent a constituency that contains an area which, although I do not know it myself, my researcher Richard Thomas tells me is as beautiful as the Gower peninsula. I share the hon. Gentleman's concern that areas such as Gower should be afforded more effective protection.
This is the first time I have contributed to a debate specifically concerning areas of outstanding natural beauty, but I have contributed to many debates on the protection of wildlife, sites of special scientific interest, national parks and the right to roam. These issues are, of course, inextricably linked.
As the hon. Member for Gower stated, we are approaching the 50th anniversary of the post-war Labour Government's landmark legislation—the National Parks and Access to the Countryside Act 1949. I hope that this Government will act in a similarly radical and forward-thinking manner. As we approach the millennium, we need further countryside legislation. However, I have already expressed concern that a super Bill, combining access, wildlife protection, AONBs and hedgerow legislation, could end up failing adequately to address the needs of any of those areas—but I am prepared to be pleasantly surprised.
It is probably worth setting out the exact definition of areas of outstanding natural beauty. They are, of course, defined under the 1949 Act to which I referred earlier. According to the Library, the designation is
supposed to conserve and enhance natural beauty, taking into account the needs of agriculture, forestry and other rural industries and of the economic and social needs of local communities.
Sustainable forms of social and economic development, which in themselves protect and improve the environment, are encouraged.
The purpose of AONBs must, of course, be to sustain the beauty of the area, but without freezing it in time—an argument that was stressed in another place as recently as yesterday.
The key difference between AONBs and national parks is that creating opportunities for recreation is not a specific purpose of an AONB. Another key point is that local authorities are supposed to take the special character of the landscape into account when creating policy and controlling development in AONBs, but, as the hon. Member for Gower pointed out, AONBs do not have legal statutory protection. That anomaly should be tackled because "taking into account" can mean different things to different people.
AONBs should be given the same status in that respect as national parks—the highest level of landscape protection. That should be reflected in planning policy guidance note 7. There should be a statutory duty on public bodies and local authorities to have regard to, and further the purpose of, AONBs.
Another feature of areas of outstanding natural beauty is that although they were designated under the 1949 Act, as the hon. Member for Gower said, that Act does not stipulate who is responsible for their management or funding. It is imperative that safe and secure funding from both central and local government be provided to make the AONB status truly effective. That is a view with which the Government have expressed some sympathy.

Mr. Andrew Tyrie: The hon. Gentleman said that he wanted AONBs to be put on a statutory basis, and I agree. Will he therefore support the Bill introduced by Lord Renton of Mount Harry, or something similar, to enable that to be done? Secondly, does he agree that the crucial requirement now is certainty? I have an AONB in my constituency—the south downs. The life of the south downs conservation board was extended for three years two years ago, so it will run out shortly. Certainty is desperately needed for those areas, where there is much concern about the long-term future.
My area does not want to be a national park. It wants an extension of the south downs conservation board. The best way forward is legislation to put that on a sustainable basis. Does the hon. Gentleman agree?

Mr. Brake: I thank the hon. Gentleman for his intervention. Some key points are made in Lord Renton's Bill, which I can support. I will be asking the Minister a question about the south downs shortly.
I believe that the Surrey hills is the nearest AONB to my constituency. It provides a place of relaxation and leisurely walks not merely for the residents of Dorking, Box Hill and Reigate, but for much of south London, including, I am sure, many constituents of mine from Carshalton and Wallington. Hence, there should be a national contribution to the running costs of that AONB.
The Liberal Democrats have supported the core proposals outlined by the Countryside Agency and the Countryside Council for Wales. I believe that the Government are also sympathetic to some of those proposals, which would tackle some of the problems that I mentioned. However, I do not believe they would deal with all of them. For instance, they would ensure that in consultation with others a management plan for the AONB was produced. They would ensure secure funding from central as well as local government, and they would require local planning authorities to consult the conservation board, where one exists, on development plans and applications for planning permission that are likely to affect an AONB.
However, the proposals would not solve every problem. For example, the conservation boards advocated by the Countryside Agency would have the power only to advise planning authorities. It is our view that there may well be a case for their having the power to veto developments that are contrary to the stated aims of an AONB. That is of particular importance if, as reported by the media yesterday, the Government are backtracking on their commitment to developing 60 per cent. of new homes on

brown-field land. It is precisely areas such as the Surrey hills AONB that would be vulnerable to green-field development if that target is relaxed. I will be happy, of course, if it is merely media spin without substance that has suggested backtracking on that target. I seek a reassurance from the Minister now or when he replies that the Government are holding firm to their target.
I am sure that there is broad agreement in the House on the need to ensure that AONBs are enhanced for the benefit of both local communities and visitors alike.
It is time for the Government to answer some simple questions. Can the Minister tell the House what is his preferred status for the south downs? Does he favour boosted or enhanced AONB status, or does he believe that the downs should become a national park? Can he tell us whether he favours a statutory requirement for conservation boards to be set up, either for all AONBs or for those that cover more than one local authority area? Does he favour a power of veto for the conservation boards over intrusive development in AONBs? Has he negotiated with the Treasury over central Government funding for AONBs, either at the 50 per cent. or the 75 per cent. level that has been advocated?
Finally, when will the Minister make a statement? The hon. Member for Gower referred to "soon, very soon and very very soon". I understand that a reference was made to "pretty soon" in another place yesterday. I will listen to the Minister's response carefully. He has the ability to safeguard some of the most beautiful landscapes in England and Wales. He will need to demonstrate that they are safe in his hands.

Mr. Chris Ruane: Thank you for allowing me to speak in this important debate, Mr. Deputy Speaker. I take this opportunity to congratulate my hon. Friend the Member for Gower (Mr. Caton) on securing this debate on the 50th anniversary of the National Parks and Access to the Countryside Act 1949. My contribution will be short, but I fully support my hon. Friend's arguments.
Half my constituency is in an area of outstanding natural beauty—the Clwydian range, which also extends into the constituencies of my right hon. Friend the Member for Alyn and Deeside (Mr. Jones) and my hon. Friends the Members for Clwyd, West (Mr. Thomas), for Clwyd, South (Mr. Jones) and for Delyn (Mr. Hanson). My right hon. and hon. Friends support and are aware of the importance of AONBs in the Clywdian range, as they have all signed a charter of support in the courtyard in front of the Members' Lobby, and I know that they wish my hon. Friend the Member for Gower well in his efforts to secure funding.
The Clywdian range in my constituency includes the historic Offa's Dyke footpath, which runs along the brow of those hills. It also includes the Jesuit college of Saint Buenoes, from where the Victorian poet Gerard Manley Hopkins roamed the hills around Tremeirchion and looked down into the vale of Clwyd and the vale of Elwy and wrote poetry about the beautiful scenery that lay before him.
I firmly believe that those hills and green vales are a national treasure—a much neglected treasure and one that is kept on the cheap. As my hon. Friend the Member for Gower so eloquently illustrated, AONBs and national


parks are considered of equal beauty and importance. I would even say that the Clwydian range in my constituency has greater beauty than many of the United Kingdom's national parks, but I could be accused of bias. Even though they are of equal beauty and importance, they do not receive equal funding, however. AONBs are the poor relatives of the national parks.
The long-term effect of that underfunding has been the under-utilisation of some of our most valuable and treasured assets. I fear that if long-term funding is not secured for AONBs, we may witness the degradation of those national assets. Funding for AONBs needs to be increased so that it is at least on a par with that of national parks. AONBs can play a key role in regenerating our rural communities, which have suffered so much in the past 10 years because of BSE, the strong pound and tighter regulations in agriculture.
My hon. Friend the Member for Gower asked us to share with him initiatives and good and bad ideas for the AONBs in our constituencies. I will share some initiatives from my constituency with my colleague and the House. It is intended, for instance, to extend cycleways in the rural areas and link them to the Sustrans national cycleway network. That will bring visitors staying on the coast of Wales into the rural hinterland in an environmentally friendly way. People from the coastal towns of Rhyl and Prestatyn, in my constituency, will be able to appreciate that rural hinterland—the mediaeval castles of Rhuddlan and Denbigh, the cathedral at St. Asaph and the marble church at Bodelwyddan.
Those areas of outstanding natural beauty should be a hook not only for visitors to Wales but for the local population. Managers of the AONB in the Clwydian range are taking another initiative. They will pilot free bus trips from the coastal towns of Rhyl and Prestatyn, where 45,000 people live—including some of the poorest people in Wales. Free transport will be provided for those who have no access to cars, to take them to the AONB so that they can experience the beauty that surrounds them.
To open up such sensitive areas as the Clwydian range to more visitors will require even more careful management to ensure that any development is sustainable and does not lead to any damage to the physical environment. I pay tribute to the managers of the AONBs of England and Wales—especially Mr. Howard Sutcliffe in my constituency. He manages the AONB on a shoestring budget and comes up with excellent new initiatives. He is committed to his work. That additional careful management will cost more. We need long-term, secure funding so that those who manage the countryside in the AONBs can concentrate on the task of management. They should not have to go to councils or quangos with begging bowls; nor should they have to lobby politicians: they should do what they are good at—managing the countryside on behalf of the public.
The financial position of AONBs in Wales is even more precarious than that of those in England. Over the years, the Welsh AONBs have been put at a disadvantage vis-à-vis their English counterparts, although they all started from a low base. There will be a chance to redress that imbalance with the advent of objective 1 funding, which will affect 15 counties in Wales; the remaining seven counties will be eligible for objective 2 funding.
There will be a total of £1.8 billion for Wales over the next six years. If we use that money carefully, we can ensure that our AONBs are brought up to scratch and that the facilities offered there are comparable to those offered by the national parks. However, objective 1 funding should be regarded as the icing on the cake; the No. 1 issue is core funding. That will ensure that the original vision, in the 1949 Act, will be achieved. I urge my hon. Friend the Minister to help us to achieve that vision.

Dr. Julian Lewis: It is a great pleasure to follow the hon. Members for Vale of Clwyd (Mr. Ruane) and for Gower (Mr. Caton), with both of whom I share membership of the Select Committee on Welsh Affairs—there is a danger of the debate becoming a little parochial. I was born and brought up in Swansea and can, therefore, advise the hon. Member for Carshalton and Wallington (Mr. Brake) that he is missing out by never having visited the area of outstanding natural beauty in Gower—the second most beautiful rural area in the country. However, I shall speak about Hampshire, especially the New Forest, which is, of course, the most outstanding area of natural beauty in Britain—even if it is not formally classified as such.
Before I begin my own comments, I shall relay the views on AONBs of the head of countryside at Hampshire county council—Mr. Merrick Denton-Thompson. He was good enough to write to me, hoping that I would be able to support the hon. Member for Gower in the general thrust of his remarks in the debate; I am happy to do so. Mr. Denton-Thompson points out:
21% of Hampshire is covered by AONB designation which provides substantial protection from changes in land use. However there is often little or no co-ordination of the land management operations which play an important role in sustaining the outstanding characteristics of such areas. There is an urgent need for more integration between agricultural and environmental objectives within Government if AONBs are to retain their outstanding contribution to the beauty of the English countryside.
I am, of course, happy to endorse that in general, but I am sure that Mr. Denton-Thompson and others will appreciate that, sometimes, the same formula does not fit every instance of beautiful countryside. The New Forest is one such case. Some people would try to force the New Forest into the straitjacket of a national park. There are also those who would like to force the parliamentary representatives of the New Forest into a similar appliance. However, my hon. Friend the Member for New Forest, West (Mr. Swayne) and I are united in our belief that the New Forest has survived very well over many years, with special legislation that acknowledges its role as a unique, living and working forest. The forest would not have its current form were it not for the unique contribution of the commoners who raise animals there. That is essential for it to maintain its character.
In recent times, the problems of the commoners have greatly intensified; they turn their animals out on the forest only as a labour of love. They certainly make no profit from doing so. However, they are content to do so in the knowledge that special mechanisms protect their rights in the New Forest, and hence the particular characteristics of the forest that give it so much value in the eyes of the many people who are fortunate enough either to visit it regularly, or—as in my case—to live there. One of the mechanisms that protect the forest is


the verderers court—an ancient institution that prevents change in the management of the forest that would be to its detriment. Another body that protects the forest is the Forestry Commission itself. The local authorities also play a serious and responsible role in keeping the forest as we want it to remain for generations to come.
The delicate interplay of all those organisations has an overall beneficial effect and keeps the balance of interests in the forest gently in equilibrium. We are concerned that forcing the New Forest into the straitjacket of national park status would centralise and bureaucratise control of the forest.

Mr. Desmond Swayne: I thank my hon. Friend for his courtesy in giving way. Does he accept that, over the past 30 years, on every development versus environment issue, one or other of the local authorities in the area has been on the side of development? That does not inspire confidence in the prospect of a national park authority dominated by local authority interests.

Dr. Lewis: As always, I wholly agree with my hon. Friend's comments on that subject. I much admire the Minister—I am pleased that he will answer the debate today—for the patience and consideration that he showed us when we made representations on that matter. My hon. Friend and I live in hope that the special status of the forest will continue to be recognised, and that the 50th anniversary of the National Parks and Access to the Countryside Act 1949—of which the Government are, rightly, proud—will not be used as an excuse to turn the New Forest into a national park. To celebrate the anniversary in that way might be to the advantage of the Government's PR machine, but would be to the disadvantage of the forest itself.
Other hon. Members want to speak so my remarks will be brief. I refer only to one other threat that seriously menaces the New Forest and to which I adverted on 26 November last year: that a giant container port will be built on the edge of the forest at Dibden bay. That container port would be part of the great port of Southampton. No one appreciates more than my hon. Friend the Member for New Forest, West and I the importance to the area of a successful port in Southampton. But the idea of giant container stacks, huge cranes, and enormous container lorries and trains trundling through the countryside, disfiguring the boundary of the New Forest, fills us with horror.
Sacrifices sometimes have to be made in the national economic interest, but if such a development is imposed on the forest, it will not be necessary in the national economic interest because there is a perfectly acceptable brown-field site in the constituency of the hon. Member for Basildon (Angela Smith) at the site of Shell Haven, an oil refinery which is closing. It is an example of cross-party co-operation that the hon. Lady and I have worked together to achieve something which might be necessary for the national economic interest, is certainly necessary for the interests of her constituents and is anathema to the interests of my constituents, so that the new container port is sited in the most suitable area.
The New Forest has been a jewel in the crown of the English countryside for 900 years. It can continue to glitter and to shine providing that it is protected from the twin threats of unnecessary designation as a national park and appalling desecration by the building of a container port far better suited to other parts of the United Kingdom.

Mrs. Diana Organ: I, too, congratulate my hon. Friend the Member for Gower (Mr. Caton) on securing this important debate on areas of outstanding natural beauty. I represent part of an area of outstanding natural beauty, which is unique in that it is covered by three local authorities and two nations—the Wye valley. It is unusual because it follows the outline of the Wye valley rather than a wider countryside area. However, that has not given it the protection that areas of outstanding natural beauty need. Under the previous Administration, under the minerals plan, there was a proposal for five sites for limestone extraction within the boundaries of the Wye valley. When the Labour Government of 1949 set up areas of outstanding natural beauty, they surely never envisaged that. As my hon. Friend the Member for Vale of Clwyd (Mr. Ruane) pointed out, pressures on such areas must now be addressed.

Mr. Martyn Jones: Does my hon. Friend agree that one problem facing areas of outstanding natural beauty is the burgeoning wind farm business which, even when outside the area, damage the aesthetic beauty of protected areas because they can be seen from them? Should not we be extending protection to those areas which are visible from areas of outstanding natural beauty?

Mrs. Organ: I agree. We would not have a wind farm in the Wye valley, but we might on the limestone escarpment at its edge, and, if that was visible from other vistas, it would detract from the landscape's beauty.
When the Hobhouse report designated our national parks and the areas of outstanding natural beauty, it left out one or two important areas, one of which was the Forest of Dean. As the hon. Member for New Forest, East (Dr. Lewis) said, the New Forest was also exempt from the designation. The Forest of Dean shares many of the characteristics of that landscape. We, too, have a verderers court and an area which is administered by the Forestry Commission. We do not have commoners, but we do have sheep badgers. That same mix of beautiful landscape and heritage linked to agriculture, forestry and the area's culture meant that the Forest of Dean was not included.

The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Mr. Alan Meale): In answer to my hon. Friend and the hon. Member for New Forest, East (Dr. Lewis), who asked about the effect of the Government's decision in respect of the verderers and the commons—I am not sure about sheep badgers—I have given assurances to both the hon. Member for New Forest, East and the hon. Member for New Forest, West (Mr. Swayne) on a number of occasions that the particular status of both groups would not be affected by the Government's decision.

Mrs. Organ: I thank my hon. Friend for that information.
The Forest of Dean was left out and, over the years, we have considered ways in which to give our beautiful landscape some kind of designation to protect it. In the past, many areas have rejected the status of an area of outstanding natural beauty, seeing it as a second-class designation without the powers required to protect the landscape.
Consequently, in April 1997, the then shadow Secretary of State for the Environment came to the Forest of Dean to see the problems facing the area. He said that the area needed special landscape protection, and that proposal has been taken forward by the Government. Land use consultants have come to the area and reported that the Forest of Dean is an area of natural beauty and of national value. We all knew that before, but it is nice to see it in a report. That report is now with the Countryside Agency, which has the remit to take forward consultation on exactly the kind of protection that the Forest of Dean should have and what area it should cover. That is obviously a matter for much wider consultation during the summer and autumn.
In the past, we in the Forest of Dean have rejected the status of an area of outstanding natural beauty because we felt that it would not provide the protection that we wanted for our beautiful landscape. Moreover, the designation is concerned only with the physical landscape; it pays little heed to an area's culture and heritage. It has very little interest in the social and economic regeneration and health of an area. I hope that the Government, in their proposed countryside Bill, will consider an area of outstanding natural beauty mark 2, which would have an holistic approach to the social and economic regeneration of the countryside and the protection of its landscape.
Many who wish to have their landscape protected may be a little chary of such a designation because it has a bad name. Many know that landowners on the edge of an area of outstanding natural beauty prefer to be outside the area rather than within it because they see such a designation as a prescriptive planning hand on the development of their agricultural businesses.
We need a visionary approach to a new area of outstanding natural beauty, rather like the pares naturels in Europe, which are inclusive and have a certain remit for the area's economy.

Mr. Brake: Perhaps the hon. Lady is looking for national park status but with local management. Would she favour that sort of model, which might also be applicable to the constituency of the hon. Member for New Forest, East (Dr. Lewis)?

Mrs. Organ: National park status also comes with its own problems. The national parks were rightly given a remit to provide leisure facilities for people from cities and other areas. There has been a problem, for example, in the Peak district, where the national park board has prevented the development of small rural activities and industries because it sees them as conflicting with the remit of the national park.
The Forest of Dean has an industrial background, although we are a rural community. We would resent not being able to develop our manufacturing sector in the villages and small towns of the forest. The direction in which a national park board wanted to move may work against keeping the economic livelihood of the Forest of Dean going. Although there would be certain advantages for others in national park status, we would reject it.
The protection of landscape of great beauty is done within a planning regime that is often seen to be restrictive and may not allow small rural and agricultural businesses

to develop appropriately to keep people employed in the rural economy. There is a mismatch between the wish to enhance the natural landscape and the desire to keep it as a living landscape. People live and work in rural areas. A way forward that could be taken in a countryside Bill may be a land use planning designation that includes a wider remit to regenerate the local area.
I do not know whether my hon. Friend the Minister has read the land use consultant report for the Forest of Dean. I know that he has visited the area and has commented to me on the beauty of the landscape. I should be interested to know what he envisages for the Forest of Dean as a result of the consultation with the Countryside Agency. We have a great opportunity. I congratulate the new Labour Government on setting up the Countryside Agency with a wider remit than the Countryside Commission. There are opportunities for the Countryside Agency to come up with something visionary and new for areas of England and Wales of special landscape that will tackle the problem of preserving areas of great beauty while keeping a working countryside.

Mr. James Gray: It is a pleasure to take part in this important and so far well-balanced, interesting and well-informed debate. I pay tribute to the hon. Member for Gower (Mr. Caton) for calling it. I find myself in the awkward position, in following the hon. Member for Forest of Dean (Mrs. Organ), of agreeing with almost every word that she said. It is an unusual position for me to be in, but none the less I pay tribute to her. I am not certain that I agreed with quite so much of what the Liberal spokesman, the hon. Member for Carshalton and Wallington (Mr. Brake), said. I have had occasion before to comment in countryside and rural debates that his constituency is some distance from the nearest area of outstanding natural beauty—not that that precludes him from having a view on the matter.

Mr. Brake: I am happy to point out that Surrey hills and Box hill are approximately five miles from my constituency, so the nearest AONB is not a hundred miles away.

Mr. Gray: I meant no disrespect to the hon. Gentleman. He and I sit on the Environment Select Committee together and I never miss an opportunity to pull his leg.
Rather than being five miles from an area of outstanding natural beauty, my constituency incorporates two. The Cotswolds includes such marvellous places as the villages of Badminton, Castle Combe and Lacock and the North Wessex downs—I must not repeat my maiden speech. I have a certain amount of experience of living and working in two AONBs and I want to talk about that rather than, like the hon. Member for Carshalton and Wallington, looking into them from outside. There is an important distinction to be made. Often, people talk at great length about how fine the landscape is and how much we like to go on holiday to areas of outstanding natural beauty. I go to one in Cornwall and enjoy it as a holidaymaker. I go fox hunting in another one—I just thought I would throw that in for the benefit of the hon. Member for Carshalton and Wallington. We all like to go for picnics in AONBs and see them on chocolate boxes.


However, we are not talking about going to them for recreational purposes—we are talking about what they are, how they can be preserved, how they can be made better and how, as the hon. Member for Forest of Dean said, we can look after the people who live and work in them. Therefore, this is a useful and important debate.
I broadly welcome the thrust of the Bill currently in the other place, introduced by my noble Friend Lord Renton of Mount Harry. Much of the Bill is useful and it will strengthen AONBs in a variety of ways. It will impose a duty on local authorities to have due regard to and further the AONBs. Curiously enough, local authorities have not had to pay attention to them until now. The Bill institutes a duty to have a management plan. It is terribly important that there must be some kind of business plan stating how the AONBs will be managed. The Bill requires local authorities to consult conservation boards on planning. Those are useful provisions.
I have some reservations about the views of some interest groups including Friends of the Earth and the Countryside Agency, which believe that the Bill does not go far enough. They have talked about more stringent restrictions in AONBs. To go further than my noble Friend does in his Bill might cause some of the difficulties that the hon. Member for Forest of Dean mentioned.
The beauty of landscapes has not happened automatically over the centuries. They are not as God made them. If one walks in the Cotswolds, one sees a landscape that has been created by farming, hedgerows, walls, fields, sheep farms and the beautiful warm yellow buildings typical of the area. All those things were created by farmers, who are the caretakers of the landscape. The crisis in agriculture must worry all of us who care about AONBs. Not only past but current generations have created AONBs. My two—not exclusively mine, I hasten to add, but the two in my constituency—are traversed by the M4. People who like to denigrate my constituency say that it is junctions 16 to 18 of the M4 and a couple of miles either side of it.

Dr. Julian Lewis: Disgraceful.

Mr. Gray: That is disgraceful, as my hon. Friend correctly says. It is true that the M4 goes straight through the middle of my constituency. We have some vibrant companies such as Dyson, who makes his vacuum cleaners in Malmesbury right in the centre of the Cotswold AONB. Mr. Dyson is currently applying for planning permission to double the size of his factory from 1,100 employees to 3,000. The land is smack bang in the middle of an AONB. I have not yet come to a clear conclusion on the application. Do we say to Mr. Dyson, "Of course you must continue to expand. Your business is important to us. You employ up to 3,000 people"? Or do we say that the AONB is so overwhelmingly important that Mr. Dyson must be prevented from expanding and he can perhaps move to south Wales, Swindon or wherever? There must be a balance between considering the area as a picture on a chocolate box and considering it as a chocolate box within which real people live and work—a point made well so far in the debate.
We have to think not only about the beauty and the landscape, but about the economic and social attributes of the area and all the other things that go into the creation of an AONB such as that in my constituency. It is a living,

working countryside. People who look at AONBs from outside forget about the rural poverty of many people in constituencies such as mine, and about the transport problems and the cost of petrol for people who live in an AONB. All they think about is going to an area of outstanding natural beauty on a Saturday to have a picnic. That is not what AONBs are about: they are about creating living, working places that are as vibrant as the towns.
I welcome the debate and many of the contributions. I thoroughly welcome most of the proposals in my noble Friend's Bill. However, I urge a little caution on the forthcoming rural Bill, which may be introduced in the next Session. We must find a way of preserving the beauty of our countryside that we inherited from our grandparents and ancestors, but we must never forget the vibrancy and economic importance of such areas. It is terribly important to maintain that economic vibrancy by preserving jobs and improving employment prospects in the area. We must constantly balance the everlasting, unchanging changelessness—in the words of the English Prayer Book—of the English countryside, which in my constituency straddles the vibrancy and economic importance of the M4 high-tech corridor.

Mr. Damian Green: I echo the congratulations offered by hon. Members on both sides of the House to the hon. Member for Gower (Mr. Caton) on securing this debate, not only because of the importance of the subject, but because it has given hon. Members the chance to take part in an imaginary tour of some of the loveliest areas of England and Wales, which is good for the soul and informs an important and topical debate.
Much mention has been made of the Bill before the House of Lords proposed by my noble Friend Lord Renton. It is worth putting on record that this House has held its own in the literary stakes. Those who are interested in the subject will have read the Second Reading debate on Lord Renton's Bill in the other place. It showed not only the expertise and experience that we have all come to expect from Members of that House, but it contained a surprising degree of poetry. Keats, Kipling and Wilde were quoted as illustrations of what AONBs evoke in some of our greatest writers. I am glad that, in our tour of the same subject, the hon. Member for Vale of Clwyd (Mr. Ruane) mentioned Gerard Manley Hopkins, and my hon. Friend the Member for North Wiltshire (Mr. Gray) mentioned the English Prayer Book. This House has held up its literary end.
I agree with the hon. Member for Gower about the necessity for a speedy response from the Government on the issues that have been raised by Lord Renton and by various environmental bodies, including the Countryside Agency. The Opposition welcome practical moves to improve the status and protection of AONBs. If the 1949 Act needs changing, we will not oppose any necessary moves in that direction.
It is worth mentioning in detail the ideas suggested by Lord Renton, partly because his Bill is closely based on the advice given to Ministers by the Countryside Agency—or the Countryside Commission as it then was. That advice fell into three main categories. The first was to establish statutory conservation boards on an opt-in and not a compulsory basis, which is an important distinction.


The second was to secure funding from central and local government, and the third was to strengthen the protection given by the planning system. I am sure that the Government will consider each of those three areas, and will ponder how best to put each of them into legislation.
I agree with hon. Members that the Government should proceed quickly, but I urge them not to mix the vital countryside protection measures that we all want with more politically controversial proposals. The Opposition will support sensible legislation that updates wildlife and countryside protection laws, but it must not be mixed up with damaging and controversial legislation, such as right-to-roam measures or any new attempt to introduce anti-hunting provisions.
The future of AONBs and other areas, such as sites of special scientific interest, is too important to be put at risk, which it would be if the much-delayed countryside Bill were designed to cause political controversy. With that caveat, I hope that the Minister will give us some assurance that of all the delayed Bills that his Department has not yet got into the legislative programme, that one will feature in the next Session. If it is limited to measures that are wanted by hon. Members on both sides of the House, Lord Renton and the many conservation bodies that take a deep interest in these matters, we shall give it a fair wind, although we shall obviously have detailed comments to make. I hope that that strengthens the arm of the Deputy Prime Minister in negotiations with his colleagues about what will appear in the next Gracious Speech.
This is an urgent measure, but each issue is complex. I shall deal with them in turn, as they appear in the Renton Bill. My hon. Friend the Member for New Forest, East (Dr. Lewis) talked about the need for co-ordination among the various bodies that currently have powers over AONBs. There is clearly a strong argument for statutory management boards built on the south downs model. It is wise for Lord Renton to propose making that optional rather than compulsory. Different circumstances obtain in each AONB, not least the practical problem of the number of different local authorities that are involved in controlling an area. I strongly believe that permissive powers are better than an imposed centralised structure.
One may well ask the valid question whether an additional tier of bureaucracy that may emerge in some areas is the best way, in practice, to protect the countryside. We are all interested in the countryside. As my hon. Friend the Member for North Wiltshire said, AONBs are not merely picture postcard areas. If the imposition of an extra tier of bureaucracy hinders sympathetic development, it may, in the long term, do no good to the preservation of the beauty of these areas.
The Minister should also consider the duty of local authorities to act sympathetically to protect AONBs. As well as a sympathetic attitude, we all know that money is very important. AONBs are the equivalent of national parks in terms of landscape quality, but not in other ways. It has been said that although AONBs may not be the ugly sisters, they are the poor sisters of the national parks. They do not get the same support as national parks. Many local authorities will feel that they are in the same position. I urge the Government not to impose new duties on those local authorities without giving them the money to perform them effectively. The Countryside Agency

reckons that 50 per cent. of the core management costs should come from central Government; others are bidding higher at 75 per cent. Will the Minister explain his thinking on this issue?
Recreation is clearly another difficult area. Too much of it would destroy an AONB: not just its natural beauty, but the preservation of its flora and fauna. I congratulate the Sussex downs board on its success in hiding the 32 million visitors to that area each year—not least in hiding them from each other—so that its beauty is not lost. I am sure that the Minister appreciates this essential point: if we destroy the flora and fauna that constitute an AONB, they are destroyed for ever. Sympathetic recreation is extremely important.
I feel most dubious about my noble Friend's Bill in the area of compulsory purchase. I have two reasons for wondering whether extending the powers of compulsory purchase is an appropriate way of protecting AONBs. First, responsible private ownership has proved to be the best way of ensuring the long-term protection of a managed landscape. I am encouraged by the tone of this morning's debate to believe that there is no instinctive prejudice on either side of the House against private ownership and the advantages that it can bring to our countryside.
A few months ago, The Field magazine wrote:
The old threat of nationalisation of the ownership of land has been replaced by a gradual move to actual nationalisation of the use of land.
That is an overly dramatic statement, but it is an important and legitimate consideration. As long as its private owners behave sympathetically, too much intervention in the landscape may do long-term harm. Bodies such as the Country Landowners Association and the National Farmers Union have pointed out—as did my hon. Friend the Member for North Wiltshire today—that the landscapes are both settled and managed. They are not empty areas where people go for the weekend to enjoy the chocolate box scenery. The work that has been done to such areas—and which continues to be done within them—makes them attractive. We must not turn them into museums.
In that regard, I pay tribute to the work of the Rural Development Commission—which ceased to exist this week. I know from its efforts in my constituency that it has worked hard to provide the support for small local businesses that allows people to continue to live and work in villages and therefore preserve the health of the countryside. I hope that the RDC's good work will be continued not only by the Countryside Agency, but by the regional development agencies.

Mr. Gray: Will my hon. Friend confirm that we are concerned that the voice of the rural areas may be lost on the regional development agencies unless the correct people are appointed to those bodies? Someone must assume the former role of the RDC and continue to fight the rural corner within the RDAs.

Mr. Green: I had restrained myself from making that point, but I happily agree with my hon. Friend. I also fear that the rural voice will be lost on the RDAs.
Although work should continue in AONBs, it is clear that they are not suitable for large-scale housing developments. The National Trust has expressed


its concern about the way in which new housing developments may be accommodated within AONBs to meet the demand for housing in rural areas. That is a topical issue in light of the release of Rogers's report yesterday. An outcome of that report must be less pressure on AONBs for house building. I must admit that, although I live in hope, I have no great expectations. I agree with the editorial in today's edition of The Independent, which recounts the Deputy Prime Minister's response to the Rogers report. He said:
It provides a wide range of interesting and forward-thinking recommendations to feed into ongoing work across Government and beyond'.
The Independent goes on to comment:
It is hard to think of a phrase of Whitehall-speak to dampen enthusiasm faster.
New measures must be introduced quickly. The Countryside Agency, in its previous guise as the Countryside Commission, got it right when it said:
We"—
that means all of us—
have a duty to future generations to protect and care for these areas of beautiful countryside. If action is not taken, their integrity will crumble; their fabric will deteriorate.
I hope that the Minister will respond to calls for early legislation in this area. Such legislation must be practical, it must be based on the real needs of our countryside and it must not include measures that will damage the countryside. I hope that the Minister will bear that in mind and that he will win a legislative slot next Session so that the House may return soon to the consideration of this vital issue.

The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Mr. Alan Meale): I, too, congratulate my hon. Friend the Member for Gower (Mr. Caton) and thank him for giving the House the opportunity this morning to celebrate the importance of areas of outstanding natural beauty in Wales and in England. I am particularly glad of the chance to respond to this debate.
My hon. Friend takes a special interest in AONBs and is very knowledgeable about them. As he demonstrated at the beginning of the debate, he is able to wax eloquently about AONBs in his constituency of the Gower, which—as he pointed out—was the first AONB to be designated in 1956. Because it was a trend-setter, the Gower clearly has a special place in the family of AONBs, and my hon. Friend's championing of it is typical of the loyalty and the pride that areas of special value inspire in people across England and Wales. My hon. Friend was certainly inspired by the countryside in the House this morning.
I was glad to meet recently my hon. Friend and a delegation from the AONB staff forum to talk about issues of interest and concern across the AONBs. As the name suggests, the staff forum is a grouping of the dedicated people who work in AONBs and who come together to exchange expertise and to champion the cause of conservation and the enhancement of those areas. At the meeting, they told me about some of the imaginative projects that are under way in our AONBs and of their concerns for the future. I look forward to meeting my hon. Friend and a further delegation from the AONB Association.
I turn briefly to a question raised by the hon. Member for Ashford (Mr. Green) in relation to the Rural Development Commission. I am grateful for the congratulations that he offered on the honourable work that that august body has performed and I agree with him wholeheartedly. However, I disagree with his interpretation of how the rural voice will be affected by its demise—a view that was also expressed by the hon. Member for North Wiltshire (Mr. Gray). I remind hon. Members that, when regional development agency boards were established, the Government insisted—this call has been repeated again and again by Labour Members—that the rural voice should be heard loudly in those august bodies.
We set out several criteria, the most oft repeated of which concerns the recruitment processes that we introduced for membership of RDAs. We insisted that if people failed the rural test in their interviews, they would not be appointed to the boards. Since then, in the context of RDA financing, we have insisted on a 20 per cent. ratio for rural and coastal communities and for coalfield areas—which, in most cases, straddle the two. That criterion is built into the economics of RDAs.
My hon. Friend spoke about the 50th anniversary of the National Parks and Access to the Countryside Act, which, I am proud to say, was enacted by the Attlee Government in 1949 and which provided for the designation of AONBs as well as national parks. I say that with pride because I was brought up in an urban coalfield area in the north-east of England.
One of the leading figures in passing the 1949 Act was Hugh Dalton, who was then the Member of Parliament for my constituency. He visited my parents on occasion to talk about matters of deep interest to him in his role as local MP. He used to wax lyrical about the importance of that legislation, as did one of my predecessors as Member of Parliament for Mansfield—Lord Bernard Taylor, who is, sadly, deceased. He was a leading figure and, at one time, Parliamentary Private Secretary to the Prime Minister, Harold Wilson. Lord Taylor was deeply engaged in the establishment of national parks and tried to build on the 1949 legislation. Like the hon. Member for North Wiltshire, I never miss an opportunity to mention such matters because, if nothing else, it makes me feel good. However, those matters are particularly relevant to today's debate. Various celebrations of that anniversary will occur this year, marking the successes that have been achieved while looking to the future. I cannot think of a more appropriate time, when we are about to enter a new millennium, for such celebration.
The formation of the AONB Association, in time for the 50th anniversary and over 40 years after the designation of the first AONB, is a demonstration of the increasing awareness of the importance of our AONBs. However, as my hon. Friend the Member for Forest of Dean (Mrs. Organ) pointed out, they have long been regarded by many as second-class citizens compared with our national parks, and many people who care for them are determined that this should no longer be the case. The AONB Association provides, for the first time, a channel for members of local authorities that look after AONBs, and others who are interested and involved, to further their common cause.
My right hon. Friend the Minister for the Environment and I very much regret that we have been unable, because of previous diary commitments, to take up an invitation


to attend this year's conference of the AONB Association in Cirencester in September. Nevertheless, we wish it well, and hope to have the opportunity to participate in future events of that kind. I have given a commitment on that.
I am reliably assured that there are 37 AONBs in England and four in Wales. Those 41 AONBs all have special qualities, but they are very diverse in size and in landscape, ranging from one that includes the limestone grassland and pretty villages of the Cotswolds to one that is less than a twenty-fifth of that size—the salt marshes and cliffs of Arnside and Silverdale. Of course, we must not forget the Gower, which has an extremely varied range of coastal and inland habitats.
It is useful at this point to remember that the legislation recognises no distinction in the landscape quality between the two national landscape designations of national parks and AONBs. Each is regarded as being as beautiful as the other. The difference lies in the fact that national park designation relates not only to landscape beauty, but to wildlife and cultural heritage, and in the requirement for the parks to be substantial tracts of countryside that provide significant recreational opportunities. National parks have also traditionally been designated in our more remote upland areas.
The purpose of designating AONBs is, of course, to conserve and enhance the natural beauty of the landscape. Many of them undoubtedly also play a big part in meeting the huge demand for visits to the countryside, and they are visited by an enormous number of people who come for all sorts of reasons, as well as being enjoyed on a regular basis by those lucky enough to live in the area.
As everyone engaged in this debate is aware, the Government are firmly committed to protecting and enhancing our finest countryside. Indeed, we fully recognise the importance to the nation of our AONBs, which contain so many of our finest landscapes. We recognise also that the interests of the local communities who live or work in those areas are vital considerations. The contributions of farmers and other landowners to maintaining the landscape are of particular importance.

Mr. Tyrie: Will the Minister give way?

Mr. Meale: In a moment. First, I want to pay tribute to the hon. Gentleman's colleague, the hon. Member for North Wiltshire—which is almost as surprising as the hon. Member for North Wiltshire paying tribute to my hon. Friend the Member for Gower. I thank the hon. Gentleman for his remarks because in these debates we often lose sight of the role of the farming and countryside communities as caretakers of our rural areas. There often seems to be a lack of communication, and I am grateful to the hon. Gentleman for pointing out the important role of those communities.

Mr. Tyrie: The Minister has made clear his commitment to the principle of AONBs. I came fairly new to this subject and, as he probably knows, two years ago, my hon. Friend the Member for Arundel and South Downs (Mr. Flight) and I called for a debate to try to secure an extension to the south downs conservation board. The Government granted a three-year extension,

which is due to expire in about 18 months. Before he concludes, will the Minister tell us whether the Government intend to make the arrangements for the south downs permanent? As he knows, and I have said before, there is widespread opposition to having a national park, but there is overwhelming local support for making the south downs conservation board permanent.

Mr. Meale: I hope to deal with that matter. If I can get through the rest of my speech in the next three of four minutes, I will give the hon. Gentleman that information.
Special consideration must be made of AONBs because of the recognition that their landscapes are of sufficient importance to have particular value to the nation as a whole. However, as I said earlier, we need to maintain a balance between that consideration and the need, which the Government's policy towards the countryside stresses, to sustain living and working communities as well as a ood-quality environment.
We have heard today about the advice on the future treatment of AONBs which the former Countryside Commission delivered to the Government last summer. I can assure hon. Members that the subject of the advice—which related to the future status of the New Forest and the south downs, as well as making recommendations for AONBs generally—is never far from my mind or that of my right hon. Friend the Secretary of State, and our postbags always contain letters about those matters.
Hon. Members will not be surprised when I confirm that I shall not today make any statement about the Government's conclusions on those matters. I can, however, confirm that they remain under active consideration in my Department and that we intend to announce conclusions very soon. [Interruption.] That is better than soon.
I understand that the Countryside Council for Wales has delivered similar advice about AONBs, although, because of the nature of the Welsh AONBs, it does not see the need to provide for statutory conservation boards. Those will be matters for the Welsh Assembly to consider.
The Government are sympathetic to the need to do more to foster a positive approach to the management and protection of AONBs into the next century. In that respect, we have already demonstrated our commitment by providing the Countryside Agency with an extra £2.5 million for work in AONBs in England this year. That will make a difference. It more than doubles the funds that were available to the former Countryside Commission for the support of AONBs, and it will allow a considerable degree of progress to be made in putting in place new management plans and new programmes, and in helping to provide additional expert staff. We shall continue to monitor progress on that to find out what is being achieved and what more needs to be done.
A great deal has, of course, already been achieved in AONBs through the enthusiasm and commitment of local people, by local authorities and other local partners working together, by the Countryside Agency in England and by the Countryside Council for Wales. I understand that at least 26 of the 41 AONBs currently have a management plan in place, and a great many have an AONB officer or a joint advisory committee set up by their local authority.
Of course, because AONBs are very different in size and nature, there is not only one way of managing them or caring for them. Some lie solely within the area of one local authority, which is generally best placed to co-ordinate a management programme. Others stretch over long distances, often following a geographical feature, such as the Sussex downs. In that case, and in other cases, several local authorities are involved.
The experiment set up by the former Countryside Commission and the local authorities in 1992 to form a conservation board for the Sussex downs has in many ways brought us to where we are today on the question of AONBs. In conclusion—

Mr. Deputy Speaker (Mr. Michael J. Martin): Order. We now come to the next debate.

Schools Funding (South-West Hampshire)

Mr. Desmond Swayne: I wish to draw attention to the £100 million that has been lost to the budgets of grant-maintained schools this year. In so doing, I shall focus principally on south-west Hampshire, because six of the nine secondary schools in the New Forest area are grant-maintained schools. They have become models of efficiency. Despite the fact that many of them have a very mixed social intake and have sought out and addressed special needs, they include some of the most successful comprehensive schools in the land.
On Monday, a BBC journalist approached me, preparatory to this debate, and suggested that the disproportionate success of grant-maintained schools in my constituency was a consequence of their rather generous funding, and that fairness required that that advantage be withdrawn and that all schools be placed in the same funding boat.
I would always suggest that the grant-maintained schools had enjoyed better funding, but I do not think that that equates to more generous funding. Grant-maintained schools—[Interruption.] If the Minister for School Standards will allow me, I shall point out that grant-maintained schools enjoyed a replication of the local education authority's locally managed schools budget, with a central add-on to cover the costs that would otherwise have been provided by the local education authority but which the schools were then required to provide for themselves. That gave the schools the liberty to spend that central add-on on their own priorities rather than on priorities determined for them by the local education authority.
Locally managed schools, under the local education authority, continued to receive quite significant discretionary grants throughout the financial year. However, they never enjoyed the principal benefit of being able to budget and plan on the basis of receiving that financing.
That form of funding for schools has now been brought to an end and replaced by fair funding. If by "fair" we mean equal, the Minister has achieved an objective, because all schools will indeed now be funded according to the same formula. Nevertheless, the grant-maintained schools have suffered a very significant fall in their budgets this year—so much so that the Minister has had to introduce a measure of cash protection to cushion them from the effects of that fall. The very existence of cash protection is a recognition of the less favourable environment that grant-maintained schools now enjoy, and that was not a Government objective.
That is a failure of the Minister's policy because, as the right hon. Member for Tyneside, North (Mr. Byers), the then Minister for School Standards, said, the Government's objective was not
to cut the amount being spent on pupils in GM schools, but to increase the funding for pupils in other schools.
He said that he was engaged in a policy of
levelling up."—[Official Report, Standing Committee A, 12 February 1998; c. 461.]
Levelling up is not the experience of grant-maintained schools in south-west Hampshire. I have in my hand a


statement issued on 15 April 1999 by the headmasters of those schools. It may help to clarify the issue if I quote at a little length:
We understood that one of the purposes of the Government's 'School Standards and Framework Act' was to extend the successful practices of the current Grant Maintained schools to all schools and the local education authorities were to be accountable for enabling schools to raise standards. Critical to the new Framework was the concept of Fair Funding …
Fair Funding should have extended the local management of schools formula to provide delegation of funds for almost all services to all schools, in effect incorporating elements of the Central Grant. As 8.7 per cent. was…agreed
as the sum to be
held back by the local education authority for such services, it would have been reasonable to expect that the local management of schools formula would provide additional delegation of this order.
Far from it. The extra delegated amount is nearer 2.8 per cent. and Grant Maintained schools typically find their income 5.9 per cent. short of their…commitments…Indeed, the reduction in real terms is so great that the extra delegation together with inflationary increases would give some Grant Maintained schools a cash income for this year some 4 per cent. lower than they received last year.
This situation triggers a measure of 'cash protection' which … leaves the schools funding this year's, incremental drift, pay rises and inflation from the equivalent of last year's income. These schools will need to lose teachers and support staff, reduce expenditure on educational resources and postpone improvements. Classes will be larger, computers fewer, books older and buildings less well maintained. The position is reflected also in the reductions to other 'special grants' where, for example, income for training teachers and regular income for capital improvements will halve.
In 2000–1, if cash protection ends, the position for some will become even more serious and an additional wave of budget cuts, typically 4 per cent. equating to 3 or 4 more teachers, will be necessary.
That statement is signed by the head teachers of Applemore college, the Arnewood school, Burgate school and sixth form centre, Ringwood school, Testwood school and Hardley school and sixth form.

Dr. Julian Lewis: Several of the schools that my hon. Friend has listed are actually in my constituency. I have a copy of a letter from Mr. Underwood, headmaster of Hardley school, to the chairman of the county council. Elaborating the thesis that my hon. Friend has advanced, he says:
It is our contention that all schools"—

Mr. Deputy Speaker (Mr. Michael J. Martin): Order. Interventions must be brief.

Mr. Swayne: I thank my hon. Friend the Member for New Forest, East (Dr. Lewis). Of course I am aware that Hardley school is in his constituency. He will be aware that, this year, as a consequence of this funding settlement, the school will have to function with 4.2 per cent. fewer teachers. It will be implementing a cut of some 20 per cent. in its funding of educational resources and it will have to spend its entire reserve, built up over nine years. Next year, if it loses its cash protection of £85,000, those problems will be compounded.

Mr. Christopher Chope: Does my hon. Friend agree that the same points apply to Highcliffe comprehensive school in my constituency, which is attended by many of his constituents?

Mr. Swayne: That is indeed the case. The principal problem that is highlighted by the headmasters is that the

key central add-on is not being fully replicated in the new extension of the local management of schools settlement. The money is not being passed on to the schools.

Dr. Julian Lewis: Will my hon. Friend give way?

Mr. Swayne: If my hon. Friend will allow me, I must make progress.
This issue touches on the bureaucracy surrounding the local education authority, which I shall attend to in a moment.
When I drew the Minister's attention to the problem on 10 June 1999, I said that some schools had even introduced a measure of charging for lessons, which gave her an opportunity to lecture me on the nature of the law and gave rise to some very unwelcome press attention on those schools. On that occasion, I referred to charging for keyboard musical skills, which one school in my constituency had had to introduce as an understandable but regrettable consequence of the settlement. It is not breaking the law.
I now draw attention to the problems of the Arnewood school in my constituency. The Minister will be aware that we have a shortage of secondary schools in south-west Hampshire. It is very difficult to get into the Arnewood school, despite all sorts of expedients in the past few years to increase the capacity of the school. Even children living at the gates of the school who meet all the high priority criteria for entry to that school must be bussed to the constituency of my hon. Friend the Member for Christchurch (Mr. Chope) and cannot get into the school.
On 7 April, the headmaster wrote to me:
I would like to draw your attention to the very significant funding difficulties that the Arnewood school is facing at the start of the new financial year. In general terms, we anticipate a drop in income this financial year of some £400,000, this with a level of protected funding without which in 2000–01 we can expect a cut of a further £200,000. In crude terms, this is a total loss of £600,000 over two financial years, which would mean losing 25 teaching staff.
I know, and the Minister knows, that not all those problems arise from the change in the funding of the schools. For example, £185,000-worth of the problem is the consequence of a mistaken formula used in the past for predicting the capitation of the Arnewood school. Nevertheless, the bald facts that the headmaster sets out in his letter are true.
In addition to the loss of funding, the damage done to grant-maintained schools is compounded by their finding themselves back under the dead hand of the local education authority's bureaucracy, from which they thought they had escaped. To give the House a taste of that, I shall treat it to a vignette, for which I am indebted to the headmistress of the Burgate school, who provided me with it. The letter is from Hampshire education authority.

Mr. Deputy Speaker: Order. I gave the hon. Gentleman some leeway in allowing him to read out the entire contents of a headmaster's letter. I would not appreciate another letter being read into the record. Perhaps the hon. Gentleman will paraphrase the letter from the education authority.

Mr. Swayne: I shall be brief, Mr. Deputy Speaker.
The letter is about the need to measure the floor space of grant-maintained schools. It explains why it is necessary to measure the floor space and adds, happily, that this feast of floor measurement will be an annual occurrence.
Before headmasters resign in horror, they should thank their lucky stars and count themselves fortunate that they live in Hampshire, which, despite the absurd machinations of the floor-measuring department, is a very good local authority. Hampshire emerged rather well from the statistics published last week. It passes on more than the entire standard spending assessment to schools. Administrative costs are only £76 per pupil in Hampshire, compared with the national average of £82. Hampshire consulted widely before deciding what proportion of its funds would be delegated to schools and what it would retain. The Minister must appreciate, however, that, last year, grant-maintained schools enjoyed 100 per cent. of their budgets and not, as this year, 85.2 per cent., with some services in kind, which the schools may not require and may not value.
Nothing could illustrate more graphically the policy blunder into which the Secretary of State has stumbled than the release last week of statistics and the attempt to name and shame local authorities. The principal instrument of raising school standards chosen by the Government is local education authorities. Their record on school standards is not a glorious one. Although the dispute has degenerated into an argument between the Secretary of State and the Local Government Association about how accurate the figures are, it is clear that the Secretary of State has a measure of reserve about the competence and motives of education authorities. Why did he bring grant-maintained schools, which were enjoying an efficient means of funding, back into the less efficient method of funding of local authority schools?
I suggest to the Minister that it would be more appropriate to proceed from now on by providing a budget directly to schools on the basis of the locally managed formula. I suggest also that the Government should make separate provision for funding what the hon. Lady regards as the proper functions of the local education authorities. She could then be sure that schools would obtain the funds that she thinks it proper they should receive, without putting herself in the absurd position in which the Secretary of State has placed himself. The right hon. Gentleman is now to be seen standing on the touchlines shouting at the players—in this instance, the LEAs—in the hope that they will take notice of what he is saying. The Government have chosen local education authorities as their instrument, but the figures released last week show that there is a complete lack of confidence—or at least some lack of confidence—in the LEAs. I hope that the Minister will take up my suggestions, and I give her that opportunity now.

The Minister for School Standards (Ms Estelle Morris): First, I congratulate the hon. Member for New Forest, West (Mr. Swayne) on securing this debate and thereby giving me a longer time than I ever have when responding to Education questions to contribute to a debate that started with correspondence that has continued throughout the year.
Secondly, I acknowledge the interest shown by the hon. Gentleman's neighbouring colleagues, the hon. Members for Christchurch (Mr. Chope) and for New Forest,

East (Dr. Lewis). I accept that they wish to do the best for the children in their constituencies. However we might differ about the different funding of education, I acknowledge a deep-seated commitment on both sides of the House in recognising that the future of our children matters. That is why it is so important to get school funding and what happens in school correct.
It was interesting to listen to the hon. Member for New Forest, West. There are 30 schools in his constituency, of which about half a dozen are grant maintained. It is interesting also that, although he spoke for slightly more than 15 minutes, he said not one word about any of the schools in his constituency that are not grant maintained. I applaud, as does the hon. Gentleman, the high standards that are attained by the GM schools in his constituency, and everywhere else. However, I wish to acknowledge—the hon. Gentleman failed to do this—the high standards that are achieved by many schools in his constituency that are not grant maintained, and have not had favourable funding in recent years. It is a cause for celebration wherever there is excellence, and not merely because excellence happens to be in GM schools. I regret that, in that regard, the hon. Gentleman's speech was somewhat one sided.

Mr. Swayne: Will the Minister acknowledge that local education authority schools in Hampshire are enjoying an increased settlement this year as a result of the improved locally managed formula? The problem is being faced by the grant-maintained schools, and that is why I dwelt on them.

Ms Morris: I an glad that my attack at least brought the hon. Gentleman to acknowledge the improved funding for most of the schools in his constituency and throughout the county since the Labour party came to government. He failed to say that the standard spending assessment in Hampshire has increased by almost £50 million during the first two years of the Labour Government, compared with a 5 per cent. increase over two years under the old county boundaries formula. That means that for children in the hon. Gentleman's constituency there has been a real increase of 6 per cent. for primary schools and 4 per cent. for secondary schools. That is to be welcomed.
When we took power, we were faced with a funding system that discriminated against children. That was not because some children were less important or needed less finance. They were discriminated against because their parents had chosen to send them to schools that did not have a GM label. The hon. Gentleman acknowledged—we must all do so—that, under the Conservative Government, there was a funding differential that was based merely on category of school. That Government had the necessary power and authority, and they could have found the resources to level up. They could have ensured that every school received the funding level that applied to GM schools. However, there was the ridiculous situation of budgets for GM schools increasing year by year in terms of revenue and capital, while real budgets for children in the vast majority of schools fell. I wonder how many angry words were spoken in the House by Conservative Members before the election on behalf of


the vast number of children who were educated under the previous Government in schools whose funding decreased year by year.

Dr. Julian Lewis: Will the Minister give way?

Ms Morris: Yes, but I give warning that, because of the extra time taken by the hon. Member for New Forest, West, this will be the last intervention I shall take.

Dr. Lewis: I thank the Minister for giving way so that I can get in a completed comment. Is not the problem that the Government have said that they will level up and extend the funding advantages from grant-maintained schools to the rest, even though the effect of those changes is that over half the central funding, which was being distributed by the GM schools, is now being retained—by the county council in our case? That means that the funding environment for the GM schools is less favourable and, thus, the Government's promise has not been fulfilled.

Ms Morris: That is the crux of the argument made by the hon. Member for New Forest, West. I shall deal with that now.
The previous Conservative Government acknowledged that there was an element of double funding for grant-maintained schools—that point was first raised by the Select Committee on Education, which had a Tory Chairman—and, well before the election, they introduced a degree of parity to the funding mechanisms. To some extent, we have furthered that. The argument revolves around the addition that was made for central functions held back by the local education authority.
On the element of double funding, the hon. Gentleman is right to say that that central annual maintenance grant gave schools extra money—I accept the figure of 8.7 per cent for schools in Hampshire—because they would no longer need the services of the local authority on which that money was spent. Hon. Members know that those schools were not charged for that money, but received the same service free from the Funding Agency for Schools. That is the element of double funding—it was delegated to those schools as central AMG, but not charged to them by the FAS. Central Government picked up the tab. We can debate that arrangement, but no hon. Member can justify it as fair and reasonable or as a funding system with which we should continue.
The previous Government remedied the error in the funding formula, and we have continued with that. I take the view that local education authorities need to do certain things, some of which concern managing the funding formula. When local authorities did not undertake such management for GM schools, the FAS did it. Someone has to manage the admissions system and the surplus places and make sure that there are sufficient places for children in LEA areas. That important measure, to which the hon. Gentleman referred, does not come free; it has to be paid for.
Schools do not want to have to manage those services by themselves—indeed, they cannot do so—so an element of what was central AMG has to be kept back by local

authorities, and that has to be part of the education budget. Much of the dispute is about that remedying of the double funding element of central AMG.
Like the hon. Gentleman, I congratulate Hampshire education authority on the way in which it has delegated funding. Compared with other local authorities, it is to be praised. Although we always want more and are never complacent, I shall not criticise it on this occasion. It has delegated 85.2 per cent. of its funds to schools compared with 82.4 per cent. nationally and 83 per cent. for all shire counties. That increased delegation and the fact that Hampshire has passed the increase that the Government have secured on to the education budget means that every school in his constituency will benefit from increased funding, as he acknowledged.
I have two more points to make. On transitional funding, I admit that it is not easy to move from a funding system that was not fair and just to one that treats children on the basis that they are of equal value and have equal need for funding. Managing that transitional arrangement is not easy. We have acknowledged the contribution made by GM schools to the debate about schools' ability to run themselves. Much of the fair funding formula and much of the work that we have done take the best from the GM system as well as the best from the system of financing maintained schools.
Last year, we offered transitional protection at cash levels based on pupil numbers. Although the hon. Gentleman did not do so at Question Time, I am delighted that he acknowledged today that some of the difficulties of Arnewood school—and of another school, which may be in the constituency of one of his hon. Friends—arise from the difference between the number of pupils who attend the school and the number who were forecast to attend. Against the predictions of the LEA, the FAS decided to fund Arnewood school at such a level last year.
Whatever funding system was used this year, and even if the FAS had been managing the funding arrangement, there would have been a clawback from Arnewood school because pupil numbers were inaccurate last year. Indeed, it has come off better because transitional protection gave it protection based on its funding last year. The money that would have been clawed back in other circumstances was not clawed back. A bit of me says that the hon. Gentleman protests too much on behalf of Arnewood school, although I acknowledge the difficulty that transitional funding can offer
We have to remember that every school that receives transitional funding is receiving more money than a comparable school in the local education authority area. I say to Conservative Members that that is a criticism not of the funding that we have put into schools and the funding mechanisms that we have employed, but of the funding that most schools had to put up with in the years of Tory government. The key point is that such schools are receiving more than schools in similar circumstances. As we enter a period of increasing education budgets, the funding of all schools will increase to match the level that favourable funding gave to GM schools before the general election and beyond it.
Teachers have received an above-average pay increase in the past year, which I welcome, and, for the first time in many years, their increase was not phased, which meant an extra cost for school budgets. I have always been sympathetic to the position in which that put some


schools—not some LEAs—so I am delighted to tell the House that, this morning, my right hon. Friend the Secretary of State announced in his speech to the inaugural meeting of the Association of Heads of Foundation and Aided Schools that transitional funding will be offered next year and will be uprated at 2.5 per cent. to take account of inflation.
We are being true to our word. We offered transitional funding for GM schools during our first year. We increased budgets throughout the local authority area so that the vast majority of schools in the hon. Gentleman's constituency could benefit. Transitional funding will continue next year and the budgets of GM schools will increase by 2.5 per cent. to take account of the pressures to which I have referred.
I was delighted to read a press release from Bob Lloyd, the chairman of the newly founded AHFAS, which says of my right hon. Friend's announcement:
This is good news for all schools. We are delighted that David Blunkett has listened to the concerns raised … by AHFAS that the Government's increase in education funding was not being passed on to schools by LEAs. He is now taking action to ensure all schools are properly resourced.
That was our pledge at the general election and it now comes not only from the mouths of Labour Ministers, but from people who have been properly elected to represent foundation and aided schools. Bob Lloyd's remark that the Government are
now taking action to ensure all schools are properly resourced
means that, for the first time, extra money will go to schools based on need, not on category. I hope that the hon. Gentleman will welcome that announcement.

Genetically Modified Food

Mr. Alan Simpson: I doubt whether anything that I shall say in this debate will come as a surprise to the Minister, who has been assiduous in dealing with the welter of parliamentary questions that I have tabled on genetically modified foods and their implications for human and environmental health. I am pretty certain that he will already have read the Bill in my name—the Genetically Modified Food and Producer Liability Bill; I am equally certain that he will have seen the "Soapbox" documentary platform that I had on this subject; and I am fairly certain that he will have heard the "Farming Today" interview that I did this morning. He may at that time already have been out feeding his civil servants. I offer those introductory comments as a tribute to the Minister's assiduous commitment to public standards and food safety.
I want to use this opportunity to give equal praise to the national campaign that Friends of the Earth is launching today on the safety of food, specifically GM food. The campaign seeks to set up a platform that establishes society's basic rights and responsibilities, which, sadly, we do not fully have but which are entirely consistent with the values with which the Labour party came to office. When we came into government, we said clearly that the society that we wanted to take part in shaping had to strike a balance between rights and responsibilities.
I believe that the campaign needs to address three rights and two responsibilities. The rights are fairly simple: the right to know, the right to say no, and the right to grow safe food. Those rights must be balanced by the responsibility to protect the environment in which we live and the responsibility to put right the damage done to that environment.
On the right to say no, European Environment Ministers have recently been involved in discussing the framework of constraints that should exist on releasing GM organisms into the environment. I welcome the fact that they have tightened the rules within the past week, although I would have preferred it had they gone a couple of steps further and recognised the strength of the case for a moratorium on GM crop growing. There is still time for a decision to be reached on that.
One of the arguments used was that we may not be able to go as far as a moratorium because it could be illegal; that it would somehow interfere with international trade agreements. As such, it would require us to abandon one of the most important principles that has guided us through the ages: the right of countries, both nationally and internationally, to lay claim to the precautionary principle. That applies to medicines, drugs and all types of new products. It means that if we are uncertain about the risk to human or environmental health, we have the democratic right to say no and to define a pause within which to reflect on the risks involved. It cannot be right that trade treaties override the obligations to put public safety first that democratically elected Governments have to the citizens who elect them.
The second right, which follows, is the right to know. A huge amount of the debate on GM foods has focused on how much—or how little—we know about the foods that we already consume. It is extremely important that


we go further down that path. It allows the public to exercise an informed choice and does not allow the food chain to be polluted, as it has been, by GM foods being secreted into it without allowing the public to make an informed choice.

Mr.David Tredinnick: The hon. Gentleman and I have discussed this matter before. As he knows, the Statutory Instruments Joint Committee, which I chair, recently reported to Parliament on the Food Labelling (Amendment) Regulations 1999. The Committee was concerned that the regulations did not require suppliers to state clearly on a product that it contained GM organisms. There was thus a danger of consumers buying GM foods without realising it. The Minister wrote to me, as Chairman, asking the Committee to look at the matter again. I am not sure that the Committee can "unreport" what it has reported, but it will look carefully at the matter.
Despite assurances that the Ministry had consulted widely, I am mindful of what Friends of the Earth—

Mr. Deputy Speaker (Mr. Michael J. Martin): Order. I must interrupt the hon. Gentleman.

Mr. Simpson: I thank the hon. Member for Bosworth (Mr. Tredinnick) for raising the issue of labelling. I know that the Minister takes it seriously because I have raised it with him as well. I hope that the hon. Gentleman will deal with it in his own speech.
I should like to direct my comments about the right to know in a slightly different direction. One of the great frauds that have been perpetrated by the biotechnology industry on our democratic process is that we have been persuaded to accept a complete contradiction. We are told that genetic modification is revolutionary technology, yet that GM crops are no different from traditional crops—that we can deal with GM products as though they are equivalents. That is the term that has been used to push revolutionary products as though they were simply novelties.
We need to step back and reflect on the case to be made for moving the scrutiny process for GM crops from the food Acts to the medicines Acts. I have a fairly simple example for the House. It is now possible to produce a potato with its own insecticide factory chugging away inside it as it grows, thus avoiding the need for extensive spraying of pesticides. However, if someone were to go into a garden centre and buy pesticides off the shelf, cautionary warnings about the health risks from those pesticides would be spelled out in large letters. A potato with the same pesticides inside has no health warning attached.
There has been no scrutiny process that has allowed us to study not only the long-term implications for human health, but the short and long-term implications for the eco-systems within which these crops are grown. We need to establish new benchmarks against which scientific scrutiny can be measured if we are to have any confidence in the industry's claims.
The third right is the right to grow safe food. It is important to stress that this is not an anti-agriculture argument. Indeed, it is an argument in favour of

agricultural rights. It is in favour of traditional agricultural processes and the protection of farmers' rights against the processes that are unfolding globally in terms of corporate exploitation of the land and the growers of food.
Last September, David Chaney, a farmer in Kentucky, pleaded guilty to a crime and was fined $35,000. He had pleaded guilty to the heinous crime of saving and replanting seeds—in this case, soya beans. He had to pay that fine to Monsanto because the soya beans had been supplied by Monsanto under new product licences, driven by patent protection, whereby there is an everlasting obligation to pay to the biotech companies royalties on their seeds. That seems perverse.
Suddenly, the whole history of human agriculture is on trial. To prosecute farmers for saving and replanting seeds is like prosecuting birds for flying, people for breathing or fish for swimming. It is the basis on which agriculture depends. Farmers have historic rights to save seeds—rights on which societies have always depended. We need to set down benchmarks that protect farmers' rights to save and propagate their own seeds.
I am pleased that in November last year a different farmer, Percy Schmeiser of Saskatoon, Canada, decided not to plead guilty because he had not bought any Monsanto seeds. They had simply turned up growing on his land. Monsanto prosecuted him, but he has put up a resolute defence, saying that if the seeds got on to his land, Monsanto should prosecute the wind and the bees—or perhaps he should have the right to prosecute Monsanto for an act of pollution and intrusion. The polluter should be prosecuted, not the farmer who ends up with the responsibility of clearing up the pollution.
In a press release on 29 September last year Monsanto, far from being apologetic, celebrated the fact that it had 475 such prosecutions across 22 states, with another 250 in the pipeline. They were all against farmers who had saved seeds. That nailed the lie that GM foods are about feeding the world. They are about biotech corporations seeking to take ownership of the global food chain. We need to protect farmers and the public against such monopolisation and takeover.

Mr. Norman Baker: The hon. Member for Nottingham, South (Mr. Simpson) has done a public service by securing the debate and saying what he has said. I wholeheartedly agree with him. Does he agree that, given the piranha-like behaviour of the biotechnology companies, it is important that liability issues should be clearly established so that we know what rights farmers and consumers have? If something goes wrong with the environment and there is pollution of a farmer's fields or further on in the food chain—let us hope that there is not—it should be clear who is liable. It will not be the farmer or the consumer, but those who are seeking to introduce alien technology to our countryside.

Mr. Simpson: That is absolutely right. I congratulate the hon. Member for Lewes (Mr. Baker) on the work that he has done on pushing that point forward. We must take the principle that the polluter pays much more seriously. I hope that recent changes in the framework agreed for the European Union may move the debate on beyond producer liability for processed food to liability for primary agricultural produce.
There must be a framework of clear, corporate liabilities for making good the damage that is done. That is one of the cornerstones of the Friends of the Earth's


campaign that is being launched today—but before I touch on that, I should like to take the House back a couple of steps.
I am always confident that the Minister will have researched the background to the issues rigorously. However, he may not know that my starting point on the issue probably dates back to my mother. I remember being taken around the supermarkets as a child. I was a willing helper, loading my mother's shopping trolley. That worked well until I was stopped from putting something into the trolley. My mother refused to allow a tin of Argentinean corned beef to cross the front line of her shopping trolley because there was a huge food scare at the time about the safety of Argentinean corned beef.
My mother was an urban warrior, defending her right to feed her children safe food. I suspect that her inclinations are identical to those of most parents today, who make the same presumptions. They will not allow food that they believe may damage their children's health into their shopping trolley. Today's campaign may not be led by my mother, but it is led by the massed ranks of the Women's Institute, by Prince Charles and by the collectivity of environmental organisations around the country. They are telling the major retailers that we intend to hold their boards of directors corporately and personally liable for every aspect of environmental damage or damage to human health that follows from the introduction of GM crops into the environment. That responsibility needs to be locked into the centre of the debate taking place in this country, which also needs to take place in the House.
We have to see where the front line of democracy is being redefined. At times, the democratic debate is led from the House; on this issue, it has been led from outside. In many ways, the defence of democracy has moved from the Bar of the House to the barcode of the supermarket checkout, where the massed ranks of the public will be actively engaged in a process of not consuming food that they believe to be unsafe. I hope that we can persuade the environmental movement to go a step further. As well as defining the liabilities and responsibilities of producers, we could get them to introduce a different form of loyalty card. Every supermarket chain in the land seems to have its own loyalty or reward card. I should like to see the launch of a "loyalty to the land" card that people can hand in at the checkout, notifying the store that the bearer does not wish to purchase any goods with GM ingredients. The right to reject is also the right to choose safely and confidently.
I hope that my hon. Friend the Minister will also want to associate himself with a non-negotiable commitment to a safe environment, a more rigorous scrutiny process and the right to put loyalty to the land and loyalty to the public before the right of corporations to exploit the food chain and to enslave farming communities.

The Minister of State, Ministry of Agriculture, Fisheries and Food (Mr. Jeff Rooker): I congratulate my hon. Friend the Member for Nottingham, South (Mr. Simpson) on securing the debate. Without devaluing his other comments, I want to concentrate on the central issue of product liability. I congratulate him on his recent private Member's Bill, the Genetically Modified Food and Producer Liability Bill. We often hear too many speeches

of complaint in the House and not enough follow-up action with parliamentarians using this place as a tool to achieve action. This is a working environment. The honour of being a Member of Parliament is a tool to be used. I do not expect that his Bill will make much progress in this Session, but that is not the intention. The Bill is a vehicle that can be ridden through many Sessions.
I cannot comment in detail on the difficulties of the farmers that my hon. Friend mentioned. I saw interviews with some of those farmers on television recently. The situation is not as clear cut as some people might think. It is not the norm for farmers to be able to save any old seed. There are very tight rules and controls governing the use of many seeds under the direction of the consent holders. Those who have researched the technology have intellectual property rights and are entitled to a return. Genetically modified foods are not in a separate category. That applies to many hybrid seeds that farmers want to use and which they have to purchase separately.
The other night, at a meeting in this place, I heard about the way in which seeds have been developed by a technique that I believe is known as mutogenesis. That horrified me far more than anything that I have heard about genetically modified seeds. If the public knew what had happened to seed development over the past 30 years there would be far more debate in this place, because that has happened in an unplanned way, with seeds being bombarded with radiation in the hope of something being developed that might be useful as a crop. We know far more about GM crops and foods than we know about their non-genetically modified equivalents. It is amazing, but most of the foods that we eat have not been subject to toxological examination as GM foods have been.
In response to what my hon. Friend said about potatoes that contain their own pesticides—we may call them biocides—I must make it clear that those potatoes are neither on sale here nor being grown commercially. Yes, technology is being used, and a vehicle may be developed to give us crops that contain their own armoury against the bugs that would otherwise eat them before we human beings get the chance to eat them.
The way in which those products are regulated is crucial because they are both a food and a pesticide at the same time. We must be very careful about how they are put on to the market. Part of our weaponry is to ensure that food is safe and does not contain products harmful to human beings. We examine thousands of products a year, looking for hundreds of different pesticides that may remain in them although they should not be there.
Early tomorrow, we shall publish a survey of pesticide residues in pears, which for the first time will specify brand names. A certain pesticide that is not allowed to be used in this country has been found in large but not harmful quantities in imported produce from Holland and Belgium. We shall give the details of where those products were purchased, both by supermarket and by country. We are policing the system all the time, and that is crucial.
As my hon. Friend said, we must bear in mind the right to know. There have been substantial changes in policy over the past two years, and we now publish veterinary medicine residue surveys, pesticide surveys and chemical contaminant surveys, with products identified by brand name. That puts a much greater onus on the importer and the producer to ensure that they know that their food is absolutely safe, and as clean and pure as can be.
My hon. Friend talked about product liability. He will know that on 3 February, in reply to an intervention on a debate on the same subject, I said to him:
Civil liability for damage caused by genetically modified organisms is covered by common law developed in the courts. On the basis of common law principles, the firm holding the marketing consent for the GMO crop can be held liable in law for any damages arising from ill effects attributed to that crop. As I have made it clear in a scrutiny Committee upstairs, the Government support the proposal in the European Commission Green Paper on food law to extend product liability to primary agricultural producers."—[Official Report, 3 February 1999; Vol. 324, c. 864.]
Producers and importers of most products have indeed long been liable for any damage caused to consumers by defects in their products, but, under the EC directive on product liability, that is applied only to processed foods, not to primary agricultural products and game.
That has changed since I spoke on 3 February. The recent extension of the scope of the directive means that it now covers the whole food chain. The United Kingdom Government fully supported the move, and the Department of Trade and Industry is taking the lead in implementing the extension. As a result, consumers will be able to sue for damages caused by fresh or processed food without having to prove producer negligence—a small but important step in improving compensation rights for consumers. Those EU rules were adopted on 10 May, and will have to apply throughout the EU by 4 December next year.
I recently gave evidence to the Environmental Audit Committee when it was producing its report on GMOs and the environment, which also considered the issue of liability for environmental damage. Its report notes that, in the United Kingdom, liability for environmental damage is currently governed by the normal rules of tort law.
The issue of liability was considered by the Council of Ministers in Luxembourg last week as part of the debate on the revision of the directive on releases of GMOs. The UK issued a minutes statement calling on the European Commission as a matter of priority to consider, outside the framework of directive 90/220, the feasibility of, and the possible criteria for, a liability regime or regimes to cover the release and marketing of GMOs. In relation to liability for producers and those who own and control the technology, we are therefore tightening up at every possible opportunity throughout the food supply chain.
Two of the other issues are consumer choice and labelling. We are determined to secure consumer choice, which can and has to be achieved in two ways. The first is effective labelling, and the second is ensuring that there are alternatives. That is why we took the initiative a year ago in publishing on our website the details of 60 suppliers of non-GM soya that could be accessed by British food producers.
Within a month of coming to office, we also changed the policy on specifying ingredients on labels, which the previous Government had declined to do. Indeed, they said that there was no need for separate labelling because such foods were neither technically nor nutritionally different.
We introduced the regulations for packaged foods from 19 March. Labels must now conform to them, and it is a prosecutable offence if they do not. We gave the catering

industry a six month lead-in, until 19 September, for non-packaged foods. That is the issue that the hon. Member for Lewes (Mr. Baker) raised, and wrote to me about, confusing the issue completely in the process.
On Friday, we shall publish the guidance notes on the regulations. I agree that they come three months down the line, but everyone knew what the plan was. They will now be published and distributed to 500,000 food establishments, so that there can be no doubt about what the rules are.
Propaganda against GM foods is often illustrated by a picture of a tomato, or we might see someone dressed up 6 as a tomato. That is nice and convenient—tomatoes are lovable products—but I must tell the public that there are no GM tomatoes on sale or imported into this country.

Mr. Baker: rose—

Mr. Rooker: No, it is impossible to give way.
There are only three products that have been regulated and are on sale in this country. The first, as my hon. Friend the Member for Nottingham, South knows, is GM tomato paste based on a variety of tomatoes developed by Zeneca in his own constituency, at Nottingham university. The tomatoes are grown in p California and the tomato paste is imported. The other two products are maize and soya, which are also imported. There are no fresh tomatoes. However, because of misleading publicity, there has been a big drop in the sale of English tomatoes. People think that they are genetically modified, but they are not.
When the propagandists are at work, the points have to be balanced and we have to put the argument across as fairly as possible. We must avoid using misleading propaganda to make our case. There is plenty of evidence on both sides of the argument, for those who want to debate it rationally, and using misleading images to make a point is not the best way.

Mr. Baker: rose—

Mr. Rooker: I am sorry, but it is impossible to give way now.
There have been several debates in the House on the subject, and there will be more. There have been more Select Committee inquiries, and other inquiries, published on the subject in recent months than on any other subject that I can recall. Nobody has come up with a shred of evidence, medical or scientific, that there is any problem with the safety of GM foods compared with the non-GM alternative. It is not as if we have not looked for such evidence; we have.
We have taken stronger powers, which were published on 21 May, to increase and open up the regulatory process. The new advisory commission on agriculture and the environment, whose members are currently being advertised for, will, I imagine, want to take on board one of the issues connected with the potatoes as early as possible. It will be an overarching body, and consumers will be represented on it, so I expect that it will press the regulatory committee and the scientific committees on whether GM foods should be regulated as pesticides, as a food, or both. The rules are different in each case.
We have taken positive action on a series of issues, and we will not stop there. The setting up of the Food Standards Agency is another way of dealing with food


safety. The advertisements for the board and commission have appeared this week, and the Food Standards Bill is now passing through the House.
I congratulate my hon. Friend on making good use of the Floor of the House, and the procedures of the House, to advance his case. In general, we do not disagree with the points that he makes, especially those affecting the safety of food and the information available to consumers.

Hospitals (Mid-Essex)

Mr. Simon Burns: I rise both in sorrow and in anger to raise on behalf of my constituents the important issue of hospital waiting lists and ward closures at Broomfield hospital in the Mid Essex hospital trust area.
The Labour candidate in the general election campaign in West Chelmsford was a national health service consultant who spent a great deal of time criticising the previous Government's record on health care in West Chelmsford and elsewhere. I vividly recall a leaflet that was distributed, saying that he was proud to support new Labour's early pledges, one of which was to cut NHS waiting lists in West Chelmsford and the rest of the country.
I am devoting this debate specifically to my constituency and its problems. Some of my constituents were convinced by the rhetoric that new Labour would bring a new Jerusalem in health care and that if they turned up at Broomfield hospital for an operation, there would be consultants and doctors waiting at the doors, fighting to be first to operate on them. Sadly, that has not happened.
Over the past two years, the number of my constituents on in-patient waiting lists for 12 months or more has risen from 104 to 1,093. Too many of my constituents write to me to complain bitterly about operations being cancelled—in far too many cases not once but twice—because Broomfield hospital cannot provide the treatment as originally arranged.
There is a problem nationally that will come back to haunt Mid Essex with a vengeance in the current financial year, concerning what has happened to the 13-weeks-plus out-patient waiting list of people who need to see a consultant before even getting on to a hospital waiting list. In March 1997, there were 555 such people in mid-Essex; now the figure is 2,422, and I suspect that it is still rising.
The total waiting list figure has risen from 8,391 in March 1997 to 9,961 this April: a rise of almost 1,600 people. I asked the Minister then responsible, who is now Chief Secretary to the Treasury, what was the agreed waiting list target reduction for Mid Essex for 31 March 1999. His junior colleague the Parliamentary Under-Secretary of State for Health, the hon. Member for Barrow and Furness (Mr. Hutton) replied:
The agreed waiting list target reduction for the Mid Essex Hospitals National Health Service Trust is to a list size of 9,738 at the end of March 1999."—[Official Report, 2 November 1998; Vol. 318, c. 416.]
Unfortunately, the task force was not even able to ensure that that target was met. In March 1999, just over 200 people above the target were on the waiting list.
I accept that the total waiting list figure, having ballooned from 8,391 two years ago to more than 11,500, has come down to 9,961; but that is still unacceptably high. I even questioned the Prime Minister on the problem. I accept that the right hon. Gentleman is not expected to know the intimate details of every health trust in the country, but my constituents would have found it more helpful if he had said that he would look into the problem and get back to me.
Instead, the Prime Minister, as has become familiar under new Labour, came back with the soundbite on the wider scale, telling us what was happening nationally. Interestingly, he also said:
we are putting in … more nurses, more doctors and more capital spending—everywhere, including mid-Essex".—[Official Report, 9 June 1999; Vol. 332, c. 648.]
That sounded optimistic. I thought that perhaps the Prime Minister knew something that I did not know that was going to help my constituents.
I tabled a question to the Secretary of State for Health about those
more nurses, more doctors and more capital spending
in Mid Essex. His junior colleague the Minister of State, the hon. Member for Southampton, Itchen (Mr. Denham), replied. I hope that I am not harming his career prospects. He said that capital spending in Mid Essex was £12 million in 1997 and £7.3 million in the current year. To me, that is a £4.7 million cut; but the Prime Minister considers it an increase. I look forward to his explanation when he replies to the letter that I have sent him.
More perplexing was the question about more doctors and nurses. The Minister gave me a figure for 1997, but he told me that the data for following years were not available because they had not been published and that data for 1999 had not yet even been collected. Again, I am puzzled about how the Prime Minister could tell me that there were more doctors and nurses; again, I look forward to his reply.
Part of the problem—I do not blame the Government—is the way in which Mid Essex and North Essex were funded under the old resource allocation working party system, with a disproportionate amount going to the east end of London at the expense of mid-Essex. That was unravelled in the early 1990s when my right hon. Friend the Member for South-West Surrey (Mrs. Bottomley) changed the funding system, and both the previous Government and the current Government in their first year recognised the problem by giving North Essex and, in particular, Mid Essex larger increases in funding.
The trouble is that the area never caught up with what it would have received if we had never had RAWP. Unfortunately, the previous Minister of State fine-tuned the funding formula for this and the previous financial year in a way that cost Mid Essex money. I know that the Minister wants to alleviate my constituents' problems. North Essex and Mid Essex urgently need more money to deal with what is clearly a problem of significant proportions that is causing undue suffering and distorting the service. I urge her to reconsider the changes in the funding formula and find ways of providing extra resources to an area that has historically had problems with financing because of its proximity to London.
Those problems are bad enough, but, just over a week ago, it emerged that the health trust is £2.4 million, and the authority just over £10 million, in deficit. One way in which they are trying to overcome that problem is by closing three wards at Broomfield hospital, saving £1.75 million; the rest is to be saved by improving management and bureaucracy. They are seeking to make those savings partly by removing about 80 bed blockers from Broomfield hospital. I fully endorse such action, as

it is ludicrous for people to remain in hospital when there is no clinical or medical reason for them to do so. Not only is keeping people in hospital expensive but their quality of life deteriorates.
I had assumed, however, that those people would either be going home, with a care package, or into residential care. I was therefore surprised to hear that those options have not been chosen, but that most of those people will be going to St. Peter's hospital and to St. Michael's hospital—thereby incurring costs to the health authority and the health trust, so that the savings may not be as great as anticipated. Moreover, as social services do not have enough money to deal with the problem, I fear that closing the wards will prove to be a one-off and short-term solution, and that, perhaps in 12 months' time, we shall be confronted with another problem of bed blocking, when we shall not again have the option of closing wards to overcome a short-term financial deficit.
Similarly, when there are so many problems with people waiting for treatment, it is crazy that three wards—84 beds—should be taken out of the hospital system and left empty and redundant so that they cannot be used to help overcome the problems facing my constituents and those of other hon. Members in the area.
I therefore urge the Minister—who is a perfectly reasonable person—to recognise that there is a specific problem in mid-Essex. I ask her to recognise, too, that my constituents do not deserve the delays, heartache and problems that they are suffering as a result of having to wait ever longer for hospital and out-patient treatment, or the misery and shock of operations cancelled at the last minute—sometimes after they have already gone to hospital psychologically prepared for their operation.
I urge the Minister yet again to persuade the NHS executive to re-examine the problem in mid-Essex; to seek to direct more money into North Essex and Mid Essex to bring down waiting lists; and to ask the hospital to justify fully why it is closing the wards, whether there is a better alternative for achieving the same aim, and what will happen to staff working in those wards, who must be extremely concerned and worried about the consequences of the actions on their role in the health service.

Mr. John Whittingdale: I thank my hon. Friend the Member for West Chelmsford (Mr. Burns) for allowing me to contribute very briefly to the debate. My constituency of Maldon and East Chelmsford is covered by the Mid Essex Hospital Services NHS trust, and, therefore, my constituents are experiencing the same problems and difficulties as those suffered by my hon. Friend's constituents.
I also congratulate my hon. Friend on securing this debate, and pay tribute to him for the assiduous way in which he has pursued the matter in recent months. He and I both know, from our postbags and surgeries, the distress being caused to an increasing number of our constituents because of the lengthening time they have to wait for operations. His efforts, however, have forced the Government and the hospital trust to publish the real figures, showing the huge increase in the number of people in mid-Essex who have to wait for an operation.
As my hon. Friend said, to be fair, there has long been a problem of underfunding and long waiting times in the North Essex health authority area. Nevertheless,


the problem was being dealt with by the previous Government, who, in successive years, awarded North Essex an above average real-terms increase. Consequently, waiting lists fell to historically low levels. However, the progress has been reversed, and the figures quoted by my hon. Friend graphically demonstrated the huge deterioration in the situation in the past two years.
Both my hon. Friend and I have many cases of individual constituents who had been given operation dates, which were months in the future, but who—at the last minute, when the date had finally arrived, and sometimes after they had gone to the hospital—discovered that the operation had been cancelled. Subsequently, they were told that they would have to wait still more months before the operation could be rescheduled.
The Government were elected on a pledge that waiting lists would fall, but the fact is that, in mid-Essex, they have got steadily worse.
In December 1998, one of my constituents, who lives in Great Baddow, wrote to me, saying that her husband was house-bound and facing a 12-month wait for a quadruple bypass operation. She wrote:
I know we don't count for much in the system of things but we are as important to our families as you are to yours … Please keep the promises that are made. I don't want my husband to die waiting.
For that one constituent, I could name another 100 who have written to me to describe similar cases.
Our constituents in the mid-Essex area deserve more from the Government. I ask the Minister now to spell out exactly what action the Government are planning to take to ensure that the situation is not allowed to continue.

The Minister for Public Health (Ms Tessa Jowell): I congratulate the hon. Member for West Chelmsford (Mr. Burns) on securing this debate, on a matter in which he has taken an active interest. I am sure that his constituents appreciate his concern.
I should begin with the figures, as they were one of the issues central to the hon. Gentleman's concern. At the time of the general election, a total of 8,391 people were waiting for in-patient treatment at the Mid Essex Hospital Services NHS trust. Mid Essex was not immune from what my right hon. Friend the Secretary of State for Health has referred to as the supertanker effect, and, in the following year, the number rose to 8,360. Since then, the number has dropped, and, at the latest count, stood at 9,961.

Mr. Burns: I think that the Minister has given the wrong figure. When the previous Government left office, the figure was 8,381; in the following 18 months, it rose to just over 11,500, but then dropped to 9,967.

Ms Jowell: I apologise to the hon. Gentleman; I misread the figure. To be absolutely clear, at the previous general election, the figure was 8,391. Subsequently, it rose to 11,360. At the last count, it had fallen to 9,961.
As the hon. Member for West Chelmsford will be aware, waiting lists have shrunk across the country. However, the situation in Mid Essex differs from the picture nationally in that it has more people waiting than it did when the Government took office—which is a

matter for concern. The case cited by the hon. Member for Maldon and East Chelmsford (Mr. Whittingdale) provided a clear illustration of why reducing both waiting lists and the suffering that they cause is our No. 1 priority.
Neither the trust's local management nor the NHS executive are willing to tolerate the situation. However, as the hon. Member for West Chelmsford made it clear, the trust has financial problems. At the end of the previous financial year, its deficit was £1.8 million. The trust has now identified savings of £1.7 million, and, this year, is planning for a deficit of £1.6 million. The trust has robust plans for next year, including further savings of £700,000 in management costs, and it expects to achieve financial balance.
The eastern region of the NHS executive has been deep in discussion with the trust about implementation of its recovery plan. Today, the regional office, the health authority and the local trust are meeting to agree the plans. There is a total commitment to achieving those plans without adversely affecting services to future patients. To that end, a group—comprising local primary care groups and social services, as well as the health authority and trust—has been formed to contribute to the plans.
That brings us to the question of ward closures. As the hon. Member for West Chelmsford knows, part of the savings central to the trust's plans arise from its proposed switch of services from St. John's hospital to Broomfield hospital and the accompanying closure of three wards at the Broomfield site. We recognise that waiting lists, budgets and ward closures are obviously interdependent.
The trust's proposals entail a complete relocation of services from St John's to Broomfield by 2002, and the sale of the St John's site. The trust believes that providing all its acute services from a single site will deliver better and safer care to all its patients, and achieve significant savings.

Mr. Burns: Is the Minister aware that one of the wards being closed was refurbished last year so that it could accommodate some of the services transferred from St. John's?

Ms Jowell: Clearly, the trust is making these proposals because it judges that they constitute the best use of available resources, and that they will protect standards of patient care. I expect that the trust took the hon. Gentleman's point into consideration when it made the proposals.
The first stage is the transfer of 86 patients from Broomfield to settings that are deemed to be more appropriate to their needs. Some patients will go home and will be cared for in the community: others, as the hon. Member for West Chelmsford said, will go into alternative community hospital care. That will allow three wards to be closed, saving £900,000 this year and twice that amount in a full year, thereby freeing up resources for investment in other, locally based services.
Perhaps naturally, the hon. Member for West Chelmsford jumps to the conclusion that fewer wards and beds will mean longer waiting lists. That is not what the trust expects. It believes that, because the beds are blocked now, their removal will not have an impact on the number of people that the hospital can treat. However, the onus is on the trust to make that case in the consultation that will follow as the strategic plan develops.
No reundancies are planned as a consequence of the closure, although the trust should be able to cut back its use of agency staff, so nurses on those wards could instead treat patients who need to be in hospital. The trust also expects to move its cardiac services to better facilities, to expand renal services so that fewer patients have to travel to London for treatment, and to increase its capacity to treat patients on a day-care basis. The trust treats fewer patients on that basis than other comparable trusts, and we hope that the number so treated will be increased.
The trust believes that, even after the proposed reduction, it will be better placed to meet the needs of the local population and it intends to refurbish the wards as part of its longer-term strategy.
I believe that I have given an accurate summary of the trust's plans, which I understand have the support of Essex social services, the health authority, other local trusts and primary care groups. As the hon. Member for West Chelmsford may know, the community health council is reserving its judgment on the immediate ward closures until it is convinced that the plans are achievable. In the interim, it has agreed with the health authority to hold a public meeting in Chelmsford on 21 July, when all the agencies will explain their plans to the public. In addition, the health authority is planning a full public consultation on the whole strategy later this year.
With that in mind, I hope that the hon. Member will understand if I do not give the plan the ministerial seal of approval—or disapproval—here and now. What I can promise him and his constituents is that, if called on to arbitrate, my right hon. Friend the Secretary of State will be guided by the one principle that always guides him in these matters—the best interests of the patients, and their care.
I mentioned the financial problems facing the trust. It might be relevant for me to say something briefly about the financial support that this Government have made available to the North Essex health authority, which largely funds the trust.
Two years ago, North Essex health authority was 3.7 per cent, or £13.8 million, below its capitation target. Today it is only 0.7 per cent, or £3.4 million, below target. This year alone, it received a cash increase of £31 million, and a real-terms increase of £18.7 million. The Mid Essex trust has also benefited directly from an £845,000 share of the accident and emergency modernisation fund. I assume that the hon. Member for West Chelmsford will welcome all that. That funding and the trust's own recovery plans are freeing resources for practical action to help patients and drive down waiting lists.
The trust is now putting together a scheme for the new day-care centre to which I have referred. It expects the centre to make a real contribution to reducing the number of people waiting for elective surgery without the need for additional beds. I wish to make it clear that neither I nor any of my colleagues underestimate for a moment the sheer misery caused by cancelled operations.
Meanwhile, the local primary care groups have been studying the patterns of referral by general practitioners. They have produced guidance for GPs that is being piloted by the local primary care group and acute hospitals to help improve the consistency and appropriateness of referrals.
The regional office of the NHS executive will continue to monitor the trust's waiting list performance, and it has been helping to identify where bottlenecks may cause delays in getting patients treated. The local waiting list task force has also been actively working with the trust.
This debate is about one NHS trust, but my response would not be complete without some reference to the national picture and what the Government are doing to cut waiting lists in the Mid Essex trust area and the rest of the country. I do not want the hon. Member for West Chelmsford or anyone else to be in any doubt about the priority that the Government and the NHS give to beating waiting lists.
Through a stupendous effort, the NHS, supported every inch of the way by the Government, has delivered a record reduction in waiting lists to below the level inherited from the previous Government. That is the action that has been taken to deliver our pledge to bring lists down by 100,000 from the level that we inherited. We have made it clear that no patient should have to wait more than 18 months for hospital treatment once on a waiting list, and I am glad to say that the Mid Essex trust has consistently delivered on that.
We have often been told that it was wrong to concentrate on the length of lists, and that we should care only about waiting times. We always believed that both could be shortened: now, average waiting times are down to below three months and are below the average that we inherited. The hon. Member for West Chelmsford must accept that, nationally, waiting times for patients waiting 12 months or more are down by one third.
I mentioned that one of the fundamental problems facing the Mid Essex trust is the number of patients ready to be discharged but waiting to be given social services support. We are taking big steps in improving joint working between health and social services, and taking action to get rid of the constraints in the existing system to providing the right services in the community.
Finally, I repeat my earlier assurances to the hon. Member for West Chelmsford and to the people in the Mid Essex trust area. The trust is expected to bring waiting lists down further, and will get the advice and support that it needs. We are determined that the hon. Gentleman's constituents and people throughout the country will enjoy the benefits of a new, modern and dependable NHS.

It being Two o'clock, the motion for the Adjournment lapsed, without Question put.

Sitting suspended, pursuant to Standing Order No. 10 (Wednesday sittings), till half-past Two o'clock.

NEW WRIT

For the county constituency of Eddisbury, in the room of the right hon. Sir Alastair Robertson Goodlad (Chiltern Hundreds).—[Mr. Arbuthnot.]

PRIVATE BUSINESS

CITY OF LONDON (WARD ELECTIONS) BILL. (By Order).

Order for consideration, as amended, read.

To be considered Tuesday 6 July.

Oral Answers to Questions — NORTHERN IRELAND

The Secretary of State was asked—

Anti-drugs Strategy

Mr. Brian Jenkins: What progress has been made in the implementation of the Government's anti-drugs strategy. [87715]

The Minister of State, Northern Ireland Office (Mr. Adam Ingram): For the past 12 months, a review team has been examining the current policy statement on drugs and has now devised, and recently agreed, a new drugs misuse strategy for Northern Ireland. This is ready to be published, but the timing of publication is dependent on progress towards devolution in Northern Ireland, as the new Assembly will have responsibility for this matter.

Mr Jenkins: I thank my right hon. Friend for that answer, but what measures have he and the Government taken to involve various sections of the community, in particular the business section, in that strategy programme?

Mr Ingram: I thank my hon. Friend for that question because the various sectors of the community are vital to producing any coherent and constructive policy to deal with the problem. I recently launched an initiative with the business community, which was well attended—there were more than 80 participants and there was a significant up-take from the business community in moving forward and dealing with that problem as it affects the workplace.

Rev. Martin Smyth: The right hon. Gentleman will remember his answer on that very subject at the previous Northern Ireland questions. After further reflection, and with his understanding of the drugs strategy that he is putting in place, does he think that, given the growing use of heroin in Northern Ireland, it is time for a change of tactics to deal with the problem? Will he welcome the recent move by the Royal Ulster Constabulary to put a mobile support unit in Ballymena to deal with it?

Mr. Ingram: We all recognise that there is a growing problem of heroin and hard drug misuse in Northern Ireland. A strategy has to deal with the reality that exists and with the possibility of that menace growing in the period ahead. The RUC is active in dealing with the problem. Of course it will constantly review how it tackles the problem, should it begin to manifest itself—hopefully, it will not—in the various communities in Northern Ireland. We are alert to that very real probability but we hope that we can tackle it in the way that we are setting forth in the strategy.

Decommissioning

Mr. Andrew Robathan: If she will make a statement on progress towards decommissioning illegal weapons under the Good Friday agreement. [87716]

The Minister of State, Northern Ireland Office (Mr. Adam Ingram): The British and Irish Governments are clear that decommissioning is an important and fundamental element of the Good Friday agreement. The current talks in Belfast are designed to implement the agreement in all its aspects. Decommissioning is not a precondition but an obligation under the agreement. The two Governments are due to consider a report from the Independent Commission on Decommissioning. We are optimistic that progress can be made if all parties are prepared to move together.

Mr. Robathan: The IRA has stated publicly several times that it is not prepared to give up its weapons, yet the Minister and the Secretary of State continue to press for the inclusion of Sinn Fein in the Northern Ireland Executive. Sinn Fein is inextricably linked to the IRA—it is one and the same as the IRA. Does the Minister genuinely believe that the IRA is operating a ceasefire? If so, who does he think murdered Paul Downey in Newry earlier this month, Eamon Collins or Brendan Fegan, or attempted to murder Martin McGartland? I trust that the Minister will not give the House some wittering, weasel words about evidence. Has the Chief Constable advised the Government that those murders were carried out by the IRA? Has he advised the Government that the IRA continues with its terrorist activities?

Mr Ingram: The original question was about the decommissioning of illegal weapons and, of course, such weapons are held by more than one terrorist or paramilitary group. In relation to the hon. Gentleman's specific points, my right hon. Friend the Secretary of State and I receive security briefings; indeed, yesterday, we received a long briefing from the Chief Constable. The best suggestion that I can offer to the hon. Gentleman is that he read the transcript of the Chief Constable's comments when he launched his annual report today. The Chief Constable gives advice and we assess the information given to us by him and by other security sources. As far as we are concerned, the ceasefires remain intact. That is why the talks are going on at present. If the hon. Gentleman argues, on behalf of his party, that talks should cease, let him say that.

Dr. Norman A. Godman: Every sane person in Northern Ireland wants decommissioning to take place so that the Executive and the Assembly can get down to work. I need hardly remind my right hon. Friend that we are within 24 hours of the formal opening of the Scottish Parliament and of the Welsh Assembly. The people of Northern Ireland want the same for their Assembly. When is General John de Chastelain due to make his report? Is it not true that the obligation on decommissioning has to be met by May next year?

Mr. Ingram: The report of the independent commission is a matter for the members of the commission. We understand that they have compiled an assessment of the various responses, and that the report is due to be given to the two Governments today; I cannot give my hon. Friend a precise time. The document will be important; it will be the best assessment from an independent body that was set up to deal specifically with that issue.

Mr. William Ross: If the Government really believe that keeping Sinn Fein out of


the Executive now would cause violence because it has not given up its weapons, how on earth is violence to be avoided when Sinn Fein is thrown out next May because it has given up no weapons in the interval?

Mr. Ingram: The hon. Gentleman has not been a supporter of the Good Friday agreement; he is now predicting the failure of the peace discussions—I hope that he is not wishing for that. As I have said to Opposition Members in the House, in Committee and elsewhere, they would do well to listen to what the majority of people of Northern Ireland want, and, hopefully, to reflect on that. They could then use all their efforts to bring about a peaceful resolution to the past 30 years of trouble and strife, imposed on Northern Ireland from too many quarters; that should become a thing of the past.

Ms Margaret Moran: Will my right hon. Friend pass the thanks of the majority of Members of the House to General John de Chastelain and his independent commission for the long and difficult work that they are doing in tackling the real issues of decommissioning? Will he please try to elicit exactly what the Opposition propose on decommissioning? How do they expect decommissioning to occur without the implementation of all parts of the Northern Ireland agreement in tandem?

Mr. Ingram: With regard to the second part of my hon. Friend's question, we have enough on our plate without trying to elicit what is in the mind of the Opposition on that matter, or trying to read how it has been tackled over recent months. The process is difficult enough without that. As for the first part of my hon. Friend's question, I am only too happy to report those strong messages of support for the good work already carried out by General John de Chastelain and the other two commissioners, and for the work on which they are currently engaged.

Mr. Lembit Öpik: As anyone who follows these matters knows, decommissioning is not a precondition of where we stand today, although obviously it must be a commitment. Therefore, aside from the fancy rhetoric, will the Minister answer as honestly and candidly as he can? How likely is it that we can make progress today in the important talks taking place in Northern Ireland on the crucial question of decommissioning in its symbolic context, as well as on the other sticking points? Can he really hope for the Northern Ireland Assembly to take up its full responsibilities, together with the Scottish Parliament and the Welsh Assembly?

Mr. Ingram: The one thing that we can say with certainty is that all parties to the current round of talks want to see that Assembly up and running. They know that the two fundamentals that will take that forward—decommissioning and the establishment of the Executive—are critical to that. Those talks are taking place as I answer the hon. Gentleman's question at the Dispatch Box. We hope that good progress is being made and that every effort will be made by the two Prime Ministers and by those who are participating in the

talks to resolve the issue and the other fundamentals, which will allow the Parliament to be up and running and to go forward from there.

Dr. Desmond Turner: I am sure that my right hon. and hon. Friends are well aware of the tremendous support on the Government Benches for the full implementation of the Good Friday agreement. Will they take a relatively simple message to both sides? The first is that the agreement cannot be rewritten, but, at the same time, it does need to be said to those who have contact with those holding illegal arms that it is difficult to take democratic decisions when behind them is the threat of the use of those illegal arms. If both sides could move, I am sure that almost all Labour Members certainly would want to see the agreement implemented in full.

Mr. Ingram: Those are the very sentiments that are at work within those around the negotiating tables in Northern Ireland, but, more so, they reflect the overwhelming wish of the people of Northern Ireland. I shall take those points back to those engaged in the process.

Mr. Andrew MacKay: We very much hope that a lasting agreement will be reached today, not least because of the innocent, law-abiding majority of people in Northern Ireland from both communities who have suffered too much in the past 30 years of troubles. Will the Minister confirm that there is only one real stumbling block, and that is the non-decommissioning of illegally held arms and explosives by the paramilitaries, both loyalist and republican? The two Governments have fulfilled all their obligations under the agreement, the constitutional parties, Unionists and nationalists, have done the same, but the paramilitaries have been all take and no give.

Mr. Ingram: I am grateful to the right hon. Gentleman for his good wishes to those involved in the negotiations. Clearly, the Good Friday agreement must be implemented in full in all its parts. That includes decommissioning. We have made that clear from the Dispatch Box time and time again. It also includes the establishment of the Executive and the implementation of all the other obligations that are placed upon the two Governments. When agreement can be obtained, we will have dealt with the two fundamental issues of the establishment of the Executive and the decommissioning of weapons.

Mr. MacKay: Will the Minister accept that we cannot be confident that the IRA will decommission its illegally held arms and explosives when, only last week, the Irish police arrested two terrorists in Donegal who were carrying explosives for bombing in Northern Ireland, who both wore Sinn Fein green ribbons when they appeared in court and who have both been admitted into the Provisional IRA wing of Portlaoise prison?

Mr. Ingram: I thought that the right hon. Gentleman wanted us to proceed with the Good Friday agreement. Two people have been arrested in the Republic of Ireland for crimes within that jurisdiction. That will be a matter for its courts. We have information on the background to that as it may have applied within Northern Ireland. As I have said before, we do not share intelligence over the


Dispatch Box. I wish that the right hon. Gentleman had listened to the reply that I gave to the hon. Member for Blaby (Mr. Robathan) about the way in which the judgment has been made and what the Chief Constable says about the current state of the ceasefire. He and the Secretary of State are both agreed on the stability of that ceasefire at the present time.

Equality Commission

Mr. Jonathan Shaw: What progress is being made on the establishment of an Equality Commission in Northern Ireland. [87717]

The Parliamentary Under-Secretary of State for Northern Ireland (Mr. John McFall): The process of appointing people is under way and it should be completed by the end of July. All efforts are being made to ensure that the commission will be broadly representative of the community, as the Good Friday agreement requires.

Mr. Shaw: I welcome the progress made so far and the hard work that everyone has put in to ensure that, since the agreement, there has been progress on establishing institutions that all the people of Northern Ireland can be absolutely guaranteed will ensure equality and fairness throughout the Province. Will my hon. Friend give an assurance that the people who are appointed to the commission will broadly reflect the communities, very much in the spirit of the Good Friday agreement?

Mr. McFall: As my hon. Friend knows, it was a difficult process to bring four bodies into one. I have to congratulate the voluntary and community groups that were involved in that. I can give him a concrete assurance that appointments will be made to the Equality Commission on merit. The posts were advertised widely in major newspapers and on the internet and were made available in several languages. At the core is the need for broad community representation. I hope that, with those assurances, my hon. Friend will welcome the new body.

Mr. Clifford Forsythe: The Minister will be aware that there are a number of commissions in Northern Ireland. If there is no agreement on decommissioning and the Assembly is suspended, will all aspects of the agreement be suspended, including the Equality Commission and the early release of prisoners?

Mr. McFall: The hon. Gentleman is looking ahead. That decision will be taken after 30 June. I do not need to remind him or other hon. Members here that the most strenuous and genuine efforts are being made today to secure that agreement. The spirit of those talks was matched by the spirit of the community groups who came together to form the Equality Commission.

Judy Mallaber: Is the Minister satisfied that the Equality Commission will properly represent the interests of women and bring into the political process those women who have been so essential and strong in the political process? Does he agree that the Equality Commission is one of the essential building

blocks of the Good Friday agreement and that it will bring benefits to people who are disadvantaged in all sections of the community?

Mr. McFall: The issue of women is one of the key tests of the Equality Commission. As my hon. Friend knows, we are now establishing one of the most advanced frameworks for equality and rights in Europe. The experiences of women have been taken into account. Over the period of the troubles, it is women who have largely kept communities together. We are thankful for that, and we welcome their inclusion in the Equality Commission.

Drumcree Parade

Shona McIsaac: What measures she is taking to avoid disturbances in connection with the parade at Drumcree. [87718]

The Minister of State, Northern Ireland Office (Mr. Adam Ingram): The Government regret the necessity for the recent Parades Commission ruling. Considerable efforts were made, and continue to be made, to reach a satisfactory accommodation. The Parades Commission ruling has legal force and all law-abiding people should respect it, however much they dislike it. Meanwhile, I am confident that the RUC and the Army will be able to cope with any threatened disorder in the days ahead.

Shona McIsaac: I thank my hon. Friend for that answer. I am sure that the whole House agrees that, in recent years, there has been far too much violence and disturbance associated with the march at Drumcree. Has he emphasised to all those involved that the key to resolving this issue is parity of esteem, that both traditions have to recognise that the other tradition exists and that, in order to give peace a chance, people must learn to make friends with their enemies? To that end, will he convey the message to Northern Ireland that people ought to try to have a peaceful weekend this weekend and all future weekends?

Mr. Ingram: I agree entirely with those sentiments. In recent years, the human cost of Drumcree has been dramatic. One RUC officer has lost his life and many others have been injured, and tens of RUC families have been forced to move home. Families who live in the Garvaghy road are being forced to live in the most intolerable circumstances. The only way forward is for both sides to reach an accommodation. The Prime Minister has expended a lot of energy over recent days trying to get an agreement such as my hon. Friend described.

Mr. John Wilkinson: Has not the timing of the Parades Commission's banning of the proposed march at Drumcree shown that these decisions are supremely political in their nature? They should be made by Her Majesty's Ministers, taking into account all the circumstances that obtain at the time, and should not be shuffled off to a Parades Commission, whatever its ancestry. Will the Minister always bear in mind the fact that there is no equivalence between the exercise of the


citizen's rightful entitlement to walk on the Queen's highway and the violent efforts of those who wish to frustrate that democratic right?

Mr. Ingram: I should have hoped that the hon. Gentleman understood that the Parades Commission has legal force behind it. This decision is a legal determination by that body. I should have thought that all law-abiding citizens would be only too willing to rise in this Chamber and say that they support that legal ruling. It is not a political decision: it is a matter for that body, which Parliament established.

Mr. Steve McCabe: Does my right hon. Friend agree that the Orange Order and those who purport to speak for it will be judged by the world on the way that they behave this weekend in response to the ban?

Mr. Ingram: The Orange Order has shown great willingness to engage in this process over recent days in its talks with the Prime Minister. Continued efforts will be made to bring about a reconciliation and a different accommodation in that area. If its members behave with dignity in that march on Sunday—most of them want to do so—they will have the support and respect of the House and the majority of people in Northern Ireland. They have it in their own hands to ensure that this Sunday passes off peacefully.

Mr. William Thompson: Does the Minister agree that the Orange Order is doing everything in its power to ensure that the legitimate protests are peaceful, and has asked anyone who wants to cause trouble to stay away? The Prime Minister acknowledged that in his recent contacts with members of the Order. Will the Minister acknowledge that? As the Human Rights Act 1998 will come into operation next year, will the Minister review the Public Processions (Northern Ireland) Act 1998 to ensure that all its provisions accord with the convention on human rights?

Mr. Ingram: All Government legislation must conform to the Human Rights Act 1998, and that examination takes place at all times. The matter would be considered in the courts if anyone challenged us. If we were found to be wrong, we would have to amend the legislation.
The Orange Order has been engaged in discussions with the Prime Minister in recent days, and that is encouraging. There is movement towards a different realisation from that which has applied in recent years. That will hopefully help to bring about a different approach for this Sunday and for the years ahead.

Devolution

Mr. Tony McNulty: If she will make a statement on progress towards devolution in Northern Ireland. [87719]

Sir Teddy Taylor: What progress has been made in discussions on the future constitutional arrangements in Northern Ireland. [87720]

Mr. David Winnick: If she will make a statement on the latest position on the peace process. [87724]

The Secretary of State for Northern Ireland: A great deal of progress has been made towards achieving devolution. My right hon. Friend the Prime Minister and the Irish Prime Minister are currently engaged in intensive discussions with the parties to try to reach agreement on the outstanding issues and enable devolution to take place. I am sure that the whole House joins me in wishing them well in making progress in the hours ahead.

Mr. McNulty: I thank my right hon. Friend for that response. She will be aware that confusing signals are emanating from the Belfast talks. Will she ignore the witless, partisan and frankly irresponsible comments of some on the Opposition Benches and give us her real assessment of how far we are from the real prize of devolution and lasting peace in Northern Ireland?

Marjorie Mowlam: I have difficulty answering my hon. Friend's question. It is difficult to provide facts in the middle of a negotiation, as he and others who have engaged in negotiations will know. We were feeling positive at lunch time, but by the time that I left to come to this place an hour later, people were getting worried again. The situation goes up and down: it is a case of three steps forward and two steps back. It is difficult to give a fair judgment to the House now. I apologise to hon. Members for that, but it is the nature of negotiations. My colleagues in the Northern Ireland team have done their best to answer questions today, but I assure my hon. Friend and other hon. Members that, when the talks have finished, there will be a statement on the details, by me or by the Prime Minister, as soon as is feasible.

Sir Teddy Taylor: I wish the right hon. Lady every possible success and blessing in her complex and difficult task. Will she make it abundantly clear that, should the talks sadly fail, all those who have been released very early from custody—some of whom were convicted for the most appalling crimes—will be returned immediately to prison in the interests of the security of people on both sides of the community?

Marjorie Mowlam: The details of the Northern Ireland (Sentences) Act 1998 do not facilitate the course of action that the hon. Gentleman has outlined. However, I make it clear that, as my right hon. Friend the Minister of State said a minute ago, it is difficult to say exactly what will happen after the 30th. If I were to do so now, the folk in Northern Ireland would discuss not how to deal with the issues of the Executive, decommissioning and how it will be determined in line with the Independent Commission on Decommissioning but my answer to the hon. Gentleman. That is why I am afraid that the hon. Gentleman will have to wait a wee while. However, I guarantee that there will be an answer when the outcome of today's talks is known.

Mr. Winnick: Does my right hon. Friend agree that, if the negotiations do not succeed, it will be a moment of real joy for those responsible for last year's Omagh atrocity, for instance, as well as for the loyalist murder gangs who would seize any opportunity to start a murderous pogrom against the minority community? Should not that be borne in mind by those on the Opposition Benches, some of whom give the impression that they do not want the negotiations to succeed?

Marjorie Mowlam: It is difficult with the parties that are not supporting the agreement and it is very difficult with those who are bent on destroying it by violent means. However, many of those who are anti-agreement—particularly the hon. Member for North Antrim (Rev. Ian Paisley) and the Ulster Democratic Unionist party—were in the talks building yesterday. The Prime Minister and I have had meetings with them in the past three or four days. It is their democratic right to oppose the agreement, but they remain very interested in what progress is being made. That is where the Minister of State, Northern Ireland Office, my right hon. Friend the Member for Torfaen (Mr. Murphy), is now and he sends his apologies to the House.

Mr. Malcolm Moss: While the Opposition hope fervently for a settlement later today on the implementation of the Belfast agreement in full, does the Secretary of State agree that talking about falling into an abyss if no such agreement is reached may be counterproductive? After all, life in the Province must go on and we cannot afford to have a political vacuum. Will the Secretary of State confirm that the Government intend to continue talking in order to press for a settlement and that, if Sinn Fein-IRA do not fulfil the requirement under the Belfast agreement to decommission by next May, they will proceed with devolution with the consenting parties, excluding Sinn Fein?

Marjorie Mowlam: I am sorry, but I have tried to explain in my responses to three questions today why I will not answer that specific point. The hon. Gentleman is asking me to negotiate across the Dispatch Box what the parties in Northern Ireland are now discussing. It is for the parties in Northern Ireland to reach conclusions. I hope that we in this House and those in the Dail in the Irish Republic will do everything possible.
The best indication to the hon. Gentleman of the situation in Northern Ireland and the negotiations is the number of people who come to the doors of the building in which the talks are taking place. Just as I was leaving that building, a group from the Northern Ireland Youth Forum arrived with a letter for every member of the talks. Those talks are taking place for them. In their letter, the young people said:
We do not want a return to the violent sectarian cauldron of the past. Nor do we want to live…in a state of suspended animation where growth is impossible.
The parties in Northern Ireland are doing their best to make progress.

Oral Answers to Questions — PRIME MINISTER

The Prime Minister was asked—

Engagements

Mr. John Randall: If he will list his official engagements for Wednesday 30 June.

The Deputy Prime Minister (Mr. John Prescott): rose—

Hon. Members: Hear, hear!

The Deputy Prime Minister: I thank Opposition Members for that warm response. I have been asked to reply.
As the House knows, the Prime Minister has decided to remain in Northern Ireland today to make every effort to secure agreement between the parties in Northern Ireland. I am sure that the whole House would wish him, the Irish Prime Minister and all the parties well in their endeavours to bring lasting peace to Northern Ireland.

Mr. Randall: Why are the Government fast-tracking the commercialisation of GM seeds?

The Deputy Prime Minister: They are not.

Mr.Andy King: The hopes and prayers of the House and the whole country are with our Prime Minister and Secretary of State as they continue to work tirelessly for a peaceful resolution in Northern Ireland. Does my right hon. Friend agree that without the implementation of the peace process, the men of violence will surely return, with their reign of terror? Does he agree that it is the responsibility of all those involved in the talks to choose a path of peace and to concentrate on the future, not the past; and that the children of Northern Ireland deserve a better future?

The Deputy Prime Minister: I am sure that my hon. Friend's remarks will be echoed on all sides of the House. As we speak, the Prime Minister, his Irish counterpart and other parties are discussing proposals for a way to meet today's deadline.
Throughout this process, our position has been clear—we want every aspect of the Good Friday agreement to be implemented in full. What has been written into the agreement about decommissioning still stands, and it is not a precondition but an obligation. The House will be aware that a great deal has been achieved, but the parties must take that final step; otherwise, as the Prime Minister said in the House last week, we risk a return to violence. His remark reflects the wishes of the overwhelming majority of the decent people of Northern Ireland, who simply want a peaceful and stable future for themselves and their children.

Sir George Young: Of course we understand why the Prime Minister is in Northern Ireland. The whole House hopes that the discussions that are under way can be brought to a successful conclusion and that a devolved Assembly can be established for


Northern Ireland. Does the right hon. Gentleman accept that the sole remaining block to progress has been and still is the failure of the terrorist organisations to give up their illegally owned weapons?

The Deputy Prime Minister: I welcome the right hon. Gentleman to his role of deputising for the Leader of the Opposition, and I wish him well. He raises an important issue, which is at the heart of the present discussions. Clearly, agreement will have to be reached on that matter. All parties are addressing themselves to that, and the House will wish them well in achieving a successful agreement.

Sir George Young: The House will welcome that response, but is it not the case that, for the terrorists on both sides and their political allies, it has been all take and no give? Have not the British Government, the Irish Government and the constitutional parties all honoured their side of the agreement? So does the right hon. Gentleman agree that the way the other parties can demonstrate their commitment to peace and democracy is to hand over the guns and the bombs?

The Deputy Prime Minister: The Prime Minister has made clear exactly how he feels on these matters, and he is in the middle of the negotiations, with the Irish Prime Minister. It would be far better for peace in the north of Ireland if the negotiations took place over there, and were not made more difficult by people in this place making remarks of the type that the right hon. Gentleman is making.

Ms Joan Ryan: May I tell my right hon. Friend the Deputy Prime Minister how very, very welcome is the Government's initiative, launched today, called "Living without fear"? I welcome the Government's courage and their commitment to tackling violence against women. Two women every week lose their life to a partner or an ex-partner. That is a criminal activity.
I also welcome the initiative because it recognises the importance of local projects. Will the Deputy Prime Minister confirm that the Government will continue to recognise the need for such local funding? I welcome the £6 million made available for local projects, and the extra £6.3 million for Victim Support. Does he agree that it is very important that all Government Departments continue to work together effectively to tackle this problem, which we should not tolerate in our society today?

The Deputy Prime Minister: I very much agree with what my hon. Friend has said. Hon. Members on both sides of the House would condemn domestic violence. The Government are making it clear that we shall do everything that we possibly can to assist in preventing such domestic violence, providing compensation where we can, providing assistance where we can, and running a campaign to ensure that it is brought home to people that this crime is totally unacceptable and that we shall do all that we can to prevent it.

Mr. A. J. Beith: The Deputy Prime Minister will be aware of our strong support for the efforts that the Prime Minister is making in negotiations

today, and we agree with him that, while negotiations are going on over there, the less said here on that subject, the better.
In the week when the Scottish Parliament opens, though, is the Deputy Prime Minister aware of the strong feelings in some regions of England that it is time we had powerful democratic bodies to manage regional policy? Does he recall his manifesto commitment to introduce legislation for elected regional assemblies when there is clear public demand, shown in a referendum? Can he tell the House when he expects that to happen?

The Deputy Prime Minister: This is an opportunity to offer our congratulations to the Scottish Parliament and the Welsh Assembly, to which powers will be transferred tomorrow. It is another good example of the Government carrying out their manifesto promises; and as the right hon. Gentleman has pointed out, the Government's commitment to further decentralisation can be seen in the proposals for a London elected mayor and a new regional assembly for the London area.
I have always believed in the regional government dimension. Our manifesto said that we would consult the people and take a decision then as to whether we would institute a form of regional government. I firmly believe in it. I shall be advocating it and doing all that I can to see that it is brought in.

Mr. Beith: What are we to make of reports that the right hon. Gentleman is having to do battle with No. 10 Downing street to prevent the commitment from being watered down, and to stop it disappearing from Labour's next manifesto? Is he facing difficulties of the type that he has faced over bus lanes, bus fares, road tolls and various other things? The Deputy Prime Minister did say that we deputies should stick together, so just between ourselves, would he tell me—is it getting a bit frustrating at the moment?

The Deputy Prime Minister: The right hon. Gentleman should not believe everything that he reads in the press. How could anyone possibly think that I am likely to get into any disagreement with No. 10? I am a loyal deputy to the Prime Minister, and I am very proud to serve this Prime Minister, who in two years has brought about more fundamental change in this country, and brought more benefits to the people of this country, because we are carrying out our manifesto commitments.
So I say to the right hon. Gentleman that he should take no notice of press prattle and remind himself that my right hon. Friend the Prime Minister has made it clear that such reports are garbage. And I agree with him.

Kosovo

Mr. Tam Dalyell: Who will be tasked with disarming the Kosovo Liberation Army?

The Deputy Prime Minister: I—[Interruption.] I always have problems with these closed questions.
As envisaged in United Nations Security Council resolution 1244, the commander of KFOR, General Sir Mike Jackson, is responsible for the demilitarisation of the KLA. As my right hon. Friend the Prime Minister told the House last week, the commander-in-chief of


the KLA signed an undertaking on 21 June to hand in its weapons. This will be completed in stages over 90 days. I can tell the House that the KLA is showing clear signs of complying with the undertaking. It is moving to the designated assembly areas, assisting with mine clearance and starting the weapons handover. KFOR is doing all that it can to ensure that the KLA continues to abide by its undertakings.

Mr. Dalyell: Do soldiers, however professional and well trained, make satisfactory police officers in the long term?

The Deputy Prime Minister: It is the understanding, with the United Nations, that a police force will be introduced to the area. We have already committed a number of police to that force. The more we see movement towards normal circumstances in Kosovo, the more that will be welcomed by those on both sides of the House. The objectives that we set for Kosovo were controversial and they have been carried out. In these circumstances, the introduction of a police force will be another important step to bring about normality.

Sir Geoffrey Johnson Smith: What assessment has the Deputy Prime Minister made of the remarks yesterday by Vuk Draskovic and of the effect that they will have on the disarming of the KLA?

The Deputy Prime Minister: I do not think that they will have any effect upon that. We have entered into an undertaking and all the signs are that the KLA is carrying it out, as I have said. That should be welcomed by both sides of the House.

Engagements

Mr. Piara S. Khabra: While I accept the need for checks and balances in the Freedom of Information Bill, what assurances can my right hon. Friend give that the legislation will open up public authorities in such a way that it will be able to succeed in its objective, and can thereby be recognised as one of the Government's major achievements?

The Deputy Prime Minister: The draft Freedom of Information Bill creates for the first time powerful new rights of access to information in the public sector, to which my hon. Friend has drawn attention. For the first time, people will have the right to find out how schools have made decisions on pupil admissions, how hospitals set priorities for different treatments, how the police have conducted their inquiries—a very important development—and how the Child Support Agency has made decisions about maintenance payments. I believe that this is a big step forward.
We are making sure that the public can have information about decisions that affect important areas of their everyday life. That contrasts rather vividly with the press story that we read today on freedom of information. Apparently Tories at central office—the ones that are to be sacked—are to sign a gagging clause to keep them quiet. I presume that that shows they will be on message until they die.

Sir Peter Emery: Will the right hon. Gentleman turn his mind to the major crisis in the milk

industry, which was brought about by the delay of the Secretary of State for Trade and Industry in publishing the report of the Monopolies and Mergers Commission on Milk Marque? The publication of the report is well over 10 weeks late, and it is of great importance that publication be effected. Many in the milk industry are hanging on by their fingernails—[Interruption.] The laughter from the Government Benches only goes to show how few Labour Members understand what the agriculture industry is about. People are hanging on by their fingernails and there is a demand that this report should be produced immediately. Will the right hon. Gentleman apply pressure to bring that about?

The Deputy Prime Minister: The right hon. Gentleman makes an important point and we recognise it to be such. It is being considered, and I shall pass on his advice to the Minister involved and see whether the report can be published as soon as possible. On his remarks on agriculture policy and Milk Marque, I am bound to say that the previous Government privatised the milk distribution industry and added to its difficulties.

Gillian Merron: Will my right hon. Friend join me in welcoming the double triumph of Lincoln's 300th new deal success, shop manager Nicola Robbins, whose milestone placement was made by Steve Green—himself a new deal employee? Amidst all the criticism of the new deal from Conservative Members, does he agree that we will not go too far wrong if we continue to focus on releasing the potential of young people such as Nicola and Steve?

The Deputy Prime Minister: My hon. Friend makes a powerful point and it should be—[Interruption.] The fact that more people have become employed under the new deal system should be welcomed by Members on both sides of the House. The Government have kept their commitments to getting people back to work and to making the provision of work, especially for young people, a priority.
My hon. Friend makes the point that Steve Green is a symbol of a change that is taking place in today's employment market. We offer him our congratulations and best wishes for the future. We should recognise that the number of young long-term unemployed, in her constituency in particular, has come down in two years by a massive 79 per cent. That is a considerable cut, however one measures it. Britain must never allow hundreds of thousands of young people to be put on the scrap-heap, which was another characteristic of 18 years of Tory government.
The Opposition have criticised a great deal, but the statistics speak for themselves: 100,000 young people were found jobs through the new deal and 85 per cent. were not subsidised in any way. Among young people, long-term unemployment has fallen by 60 per cent. since May 1997, so we have another record for a Labour Government—the lowest youth unemployment since 1975.
There is a very good contrast. After 18 years of Tory government—[Interruption.] You don't like it, but you're going to get it. The 18 years of Tory government


produced record unemployment of 3 million. After two years of this Government, a record number of people are in work. That is the difference.

Sir George Young: The right hon. Gentleman's colleague, the Under-Secretary of State for the Home Department, said last night of the passport crisis that the jobs of all Ministers—his, the Home Secretary's and those of every member of the Government—are on the line. Does he agree?

The Deputy Prime Minister: Nobody is on the line. Let us get the problem into proper context. More than 3 million passports have been issued this year and the Passport Agency is currently issuing 150,000 a week, which is more than 20 per cent. up on last year. There has been a 40 per cent. increase in applications in recent weeks. As my right hon. Friend the Home Secretary has made clear, he is treating these problems seriously and putting new measures in place to tackle them. He said that in his statement to the House yesterday.
Hundreds of new staff have been taken on to deal with the problems and, to be fair, let us recognise that they are due particularly to the number of passport applications being made for children. [HON. MEMBERS: "Yes, exactly."] It was our policy to implement that measure to improve the situation so that children are not abducted. That was agreed by the all-party group of which the right hon. Member for Maidstone and The Weald (Miss Widdecombe) is a member. The group recommended that measure to the House.

Sir George Young: Not even the Home Secretary yesterday pinned the blame on my right hon. Friend the Member for Maidstone and The Weald. Do the latest figures from the Home Office show that the queues are getting longer or shorter?

The Deputy Prime Minister: Today's figures show that the queues are getting shorter. I have no doubt that the advertising campaign and the information being provided by the Home Office will reassure people. Indeed, 99.9 per cent. of applicants have had their passports processed in time for their holidays. We are sorry for any inconvenience that may have been caused, as my right hon. Friend the Home Secretary said yesterday. The fact that he did not blame the right hon. Member for Maidstone and The Weald just shows how generous he is. I should point out to the House that it was he who came to the House and said that he was sorry for any inconvenience. That may seem unusual to a party that, in 18 years in government, never apologised for anything that it did.

Sir George Young: The figures published today in Hansard show an increase of 34,000 outstanding applications for the last week for which figures are available. Given that an additional £10 is currently payable by those who have to queue in person at the passport office to get their passports processed, will the right hon. Gentleman at least consider suspending that fine, which is due entirely to the Government's incompetence?

The Deputy Prime Minister: I am assured that, by 11.30 this morning, the queues had been completely

cleared. I should have thought that both sides of the House would welcome that, as it means that less inconvenience is caused. Suggestions about possible changes have been heard by the Home Secretary, and he can consider them. At least we have shown sensitivity in dealing with this problem, and people can be assured that they will get their passports in time for their holidays. The changes introduced by the Home Secretary reduce the possibility that children will be abducted.
Incidentally, I welcome the right hon. Member for North-West Hampshire (Sir G. Young) to the Dispatch Box on this occasion, but remind him that he is the third substitute for the Leader of the Opposition in two years. I do not want to worry him, but look at what happened to the other two. I hope that it will be some time before he has to get on his bike and leave the job.

Sir George Young: I am surprised that the right hon. Gentleman wants to be reminded of his last appearance at the Dispatch Box in this role.
The right hon. Gentleman said that all the queues had been cleared. Half a million people are waiting for their passports and 1 million have been unable to get through to the Government by telephone. Thousands of people are queueing at passport offices and having to pay £10 extra for the privilege. When will the Government start working round the clock to process passports instead of excuses?

The Deputy Prime Minister: As my right hon. Friend the Home Secretary made clear, we are working round the clock and at weekends to clear the backlog. I should have thought that achieving 99.9 per cent. of passport applications in time for people to go on holiday was a record. It is at least a better performance than that of the privatised railways that the Conservative party gave us.

Mr. Lindsay Hoyle: I am sure that my right hon. Friend shares my concern about the announcement of 2,000 job losses at British Aerospace. Will he initiate a high-level meeting between the Government and executives of British Aerospace to discuss those job losses in the military division, especially in the north-west? Will he ensure that British Aerospace considers the introduction of civil as well as military work, so that we do not have ups and downs in that high-profile industry?

The Deputy Prime Minister: I am well aware of the concerns expressed by British Aerospace workers, because I have a plant near my constituency. My hon. Friend will know as well as I do that the company has dealt with considerable change over the years. No doubt my right hon. Friend the Secretary of State for Trade and Industry has heard my hon. Friend's proposals. If not, I shall make sure that the comments are passed on to him so that the fears can be dealt with and we can ensure the change that is necessary to keep British Aerospace as a powerful company in the global economy.

Organ Transplants

Dr. Evan Harris: What plans he has to increase the number of organ transplants taking place in the United Kingdom.

The Deputy Prime Minister: About 2,800 organs are transplanted each year, but currently more than 5,000


people are awaiting transplants. We are keen to improve donation rates. We are taking steps to increase public awareness, such as through the organ donor campaign, which was launched in October 1998. We want donors to carry their donor cards and, most importantly, to make their wishes known to their families. That is a matter of particular concern. We are developing another important campaign to inform the medical profession about best practice in dealing sensitively with organ donors and their families.

Dr. Harris: Is the Deputy Prime Minister aware that the figures that I have obtained today show that the situation is getting worse? The number of terminally or critically ill people on a waiting list for a transplant has risen significantly, while the number of lifesaving transplants in 1998 dropped by 7 per cent. Is he aware that the current confusion in the law means that those who have given notice of their wish to donate and save a life and whose organs subsequently become available run a 30 per cent. risk of those wishes being vetoed by distraught or bereaved relatives, who should never be placed in that position?
Finally, if the British Medical Association votes next Thursday to support a move to an opt-out system of presumed consent, as has been introduced successfully in Europe, will the Government look seriously at reviewing the situation with a view to implementing such a proposal?

The Deputy Prime Minister: I am aware that the hon. Gentleman has written to my right hon. Friend the Prime Minister today making many of those points. I have seen the correspondence and I am sure that my right hon. Friend will respond. Overruling relatives' wishes is very difficult in practice, however many of us may feel about the issue. However, refusal is almost unknown when relatives know that their loved one wished to donate. That is why our current publicity stresses the need to "let your family know your wishes". I am sure that the hon. Gentleman agrees with that.
I gather that the subject is to be debated at the BMA's annual general meeting. Opinion in the medical profession is divided. Ministers have continually said that we shall consider all suggestions for improving transplant rates, but any proposed measures in that sensitive area will have to command public confidence and support. On a more personal note, when I saw the question I asked myself the same thing. I have always been in support of a donor scheme, but I am not registered and I shall correct that tomorrow.

Engagements

Mr. Keith Simpson: Yesterday, the junior Home Office Minister blamed the public for the queues outside the passport office. Does the Deputy Prime Minister support the junior Minister's statement?

The Deputy Prime Minister: Anyone who attended yesterday's debate or read any of the press reports will be well aware that my right hon. Friend the Home Secretary took full responsibility. I know that it was rather unusual under the previous Administration for a Secretary of State to accept responsibility. My right hon. Friend accepts the responsibility and he is getting on with the job to ensure that the problem is settled.

Mr. Phil Sawford: Is my hon. Friend aware that bus drivers and former bus drivers in my constituency and throughout the country very much welcome the action that this Government have taken to restore £355 million to their pension fund—money that was taken from them by the previous Government?

The Deputy Prime Minister: Yes, it is another problem from the previous Administration that I have had to deal with. With all the demands for resources to be invested in transport, finding that I have to foot the bill for an incompetent Government who robbed the pensions of the National Bus Company, and having to repay the £355 million, is an indictment of a Government who were constantly robbing pensioners one way or another. I am pleased that I have been able to settle the matter, find the compensation and bring social justice to the pensioners of the National Bus Company.

Mr. William Ross: As the Deputy Prime Minister said earlier that he was in favour of open government, will he take steps to ensure that when General de Chastelain publishes his report—perhaps later today, or tomorrow—we shall also have sight of the copy that he had yesterday?

The Deputy Prime Minister: Those are indeed matters for negotiation, as the hon. Gentleman knows. I hope to see a peaceful agreement in Northern Ireland, and I hope that all matters of free and open information should be available as much as possible—[HON. MEMBERS: "Yes or no?"] In this case, it is a matter for consideration.

Post-16 Training

The Secretary of State for Education and Employment: With permission, Mr. Deputy Speaker, I wish to make a statement on the Government's proposals for education, skills and lifelong learning in England. I thank my ministerial colleagues and officials for the work that they have done with me on the White Paper.
Earlier this year I announced a review, and consultation resulted in substantial support for radical change. It is clear that a highly skilled work force is essential for prosperity and social cohesion in the next century, that the existing post-16 system is inadequate for that purpose, that staying-on rates remain too low, and that standards are too variable and are unacceptably low in many areas. There is too little clarity, co-ordination and coherence between further education and training, and there is too much duplication and too many layers in the contracting and funding system.
In view of the need to plan for such major change, we have set out an illustrative timetable—subject, of course, to legislation. Today, I commend to the House our new White Paper "Learning to Succeed", the draft transitional plan that accompanies it, our consultation paper on the future of sixth-form funding, and the parallel consultation on the Small Business Service announced today by my right hon. Friend the Secretary of State for Trade and Industry.
We set out proposals which support the tripartite responsibility of employers, learners and Government. We need to ensure that we have high standards in further education and training, effective planning and funding, and the delivery of national targets. I wish to build on what has worked best and improve dramatically what has not.
Those in further education, training and enterprise councils and the careers service have done a good job; many have given their time freely, and I thank them for that. The local learning partnerships that I announced last autumn are developing a powerful role in bringing together providers and broader interests. Those will continue.
Today, we propose a new national learning and skills council to respond to the weaknesses that we have identified. The council will be responsible for the learning provided to more than 5 million students over the age of 16, funded by about £5 billion of public money each year. The council will bring together the role of the training and enterprise councils and the Further Education Funding Council in funding and contracting for training. It will have separate committees focusing on the needs of 16 to 19-year-olds and of adult learners, ensuring that both are addressed thoroughly.
We need greater coherence to meet the needs of students, trainees and employers. Our proposed new local learning and skills councils will take responsibility for all post-16 learning, from developing basic skills through community learning to the funding of high-level training and for promoting work force development. They will work in partnership with both the new regional development agencies and the existing local learning partnerships.
Each local council will cover a travel-to-learn and travel-to-work area. They will work alongside the local arms of the Small Business Service and co-operate with them and with local authorities on economic development and meeting labour market needs. The new arrangements will cut through duplication and unnecessary bureaucracy, with a saving of at least £50 million a year to fund the needs of learners.
Employers and the nation need skilled, adaptable men and women in order to stay competitive in the modern economy. It is vital that our new arrangements meet employers' needs and engage them in shaping and influencing the range of post-16 provision. That is why, both nationally and locally, employers will have the largest single input in the new learning and skills councils. Trade unions, local government and the service users will be fully represented. I hope that those from small as well as large businesses will work with us to help to determine a budget five times larger than that administered by TECs. Our goal is a funding system that responds to the needs of learners rather than institutions and that encourages greater participation and achievement.
Individual learning accounts, the university for industry and new incentives through the tax system will make learning more accessible. I also want higher standards and greater choice for over-16s through more co-operation between school sixth forms, sixth-form colleges and further education. Such co-operation already exists in certain areas. Both schools and colleges play a central role in the education of 16 to 19-year-olds.
We intend to promote high standards across all providers, but there are different levels of funding for 16 to 19-year-olds depending on which institution they attend. That is why the Further Education Funding Council announced last week significant improvements in the funding of colleges for those taking three A-levels. Over a period, we want to develop the principle of equivalent funding for equivalent courses. We will guarantee that present levels of funding for any school sixth form are at least maintained in real terms, provided that student numbers do not fall.
Our focus is on improved standards, increased probity and renewed emphasis on quality. Over the past two years, the Further Education Funding Council and training inspectorates have identified and tackled the weaknesses in poorly performing further education and training providers. We want to introduce greater rigour and coherence, so we will create a new adult learning inspectorate to deal with all post-19 education and training, with responsibility for inspection of work-based training for students of any age. Ofsted will be responsible for the inspection of provision for 16 to 19-year-olds in schools and colleges. The two inspectorates will work together on the inspection of colleges for that age group.
The support and guidance that young people receive is vital to their future. In the White Paper we outline a programme called "Connexions", which is designed to address the needs of young people. We propose a new youth support service to modernise and reform the careers service and improve links with the youth service: a new gateway to work and learning. We will publish further details, alongside the report from the social exclusion unit, shortly.
The proposals will make it easier to improve standards, to increase the skills of our work force, and to foster greater efficiency and co-ordination between national


training organisations, work-based training, employers and formal providers. They will help our young people to make better and more informed choices about the best route to success, and focus resources on the needs of learners.
Above all, we aim to modernise learning and skills for the economic challenges of the new century. Investment in human capital will be the foundation of success, both economically and in building a cohesive society. I commend the White Paper to the House.

Mrs. Theresa May: First, I thank the Secretary of State for prior sight of his statement and of the White Paper—although, at least in relation to the White Paper, perhaps I need to improve my skills by training in speed reading.
The Opposition recognise that the education and training of young people and others post-16 is of the utmost importance for the United Kingdom. We therefore believe that certain criteria must be met by any new proposals for provision of education and training post-16. They are clear and simple criteria, aimed at ensuring the best possible provision to meet the needs of young people and others and the needs of the country.
Do the proposals involve the minimum of centralisation and the maximum of local discretion? Do they minimise bureaucracy and ensure that maximum funding really goes to students' education and training? Do they ensure diversity of provision, flexibility and real choice for students? Finally, will they preserve the best and improve the rest—not impose a new structure, willy-nilly, over the whole system, but preserve those spheres and institutions that have worked well?
Sadly, on all four of those criteria, the proposals that the Government have announced today fail. I say sadly because, in failing to meet the criteria, the Government will be not only failing to meet the country's training needs, they will be failing young people and other learners, as they are the ones who will suffer. The proposals centralise decision-taking, increase bureaucracy and red tape, reduce diversity and throw away what has been achieved in recent years in bringing business into the education and training system through training and enterprise councils.
Today is a sad day for the Government. The proposals show that, whatever their rhetoric, the Government have turned their back on local decision-taking and only pay lip service to involvement of the private sector. As the Financial Times said today:
The last time Mr. Blunkett's centralised approach was adopted was under the Manpower Services Commission in the 1970s and 1980s".
That commission was wound up and the TECs invented precisely because it was recognised that skills shortages and training deficiencies were best tackled by the private sector at local labour market level.
Today's White Paper throws away that local decision-taking and introduces a centralised bureaucracy that will weaken the involvement of the private sector and reduce private sector commitment to local partnership. Bureaucracy will increase. There will now be a national learning and skills council, regional development agencies, local learning and skills councils and local learning partnerships before one even gets to a school or a college, let alone to a student.
How much will the Secretary of State's desire to control every aspect of the education system from Whitehall really cost? Will he tell the House how much the new structure will cost—in capital and revenue—to implement and operate in each of the next three years? How much of that money will be new money, over and above current expenditure? What criteria will be used to judge the distribution of funding by the national body? What percentage, if any, of national funds will be made available through, or on the decision of, the local learning and skills councils?
Will the Secretary of State explain how large those local learning and skills councils will be, how many staff they will employ, and what is a "travel to study and work area", which is the area that they will cover? If they have no power in the discretionary release of funds, what will their purpose be, other than as a fig leaf to hide the Government's centralising tendencies?
Three groups of people will lose out as a result of today's proposals. The first to lose out will be the Deputy Prime Minister, whose regional development agencies will be emasculated in their education and training role. The right hon. Gentleman has not had a good time recently. First, the Prime Minister drove up his bus lane, and now the Secretary of State for Education and Employment has driven a coach and horses through his regional development agencies.
The second group to lose out will be business. Over the years, many business men and women have given voluntarily of their time and that of their companies to TECs because they were concerned about improving training and enhancing the skills base in the country as a whole, but especially in their local communities. They are now to be cast to one side. How will the Government convince the business community that it will continue to have a real role to play, when that role is to be subsumed in a national body? The White Paper is 84 pages long, but the question of engaging and involving businesses merits only half a page.
Will the Secretary of State confirm that the national body will include employer representation, rather than business representation, and so could be led and driven by the public sector? By what criteria will the Government judge whether local business needs are being met in any particular area? If they are not being met, what action will be taken, and by whom? There is real concern in the business sector that the new bodies will fail to address real needs and will become nothing more than talking shops. As one business man told The Guardian recently:
What is going to happen now is a reversion to the days of manpower planning which did not work.
Perhaps this is more about the internal debate in the Labour party than it is about providing training and education, because the third group to lose out—and the most important—will be young people and other learners. Training provision in their areas will fail to meet the needs of the local community, but it will be determined nationally by the Government's agenda.
School sixth forms have been under threat since the review was announced, but they still do not know whether they have a future. If anything, the statement has made matters worse for them, as they find themselves subject to a further review, consultation on which will be held over the summer holidays. A decision will be reached


within weeks of the end of the consultation exercise, which therefore looks very much like the normal sham that we expect from the Government.
Will the Secretary of State tell the House who will undertake the review of school sixth forms? How will consultation be conducted with school sixth forms, and with others? Will the Secretary of State confirm that school sixth forms, unlike colleges, will get no additional funding for the new curriculum? If no money is to be made available, what will be the consequences for standards and for schools' ability to offer the full range of subjects under the new curriculum? Will school sixth forms also be excluded from funding for other Government initiatives in future?
Local education authorities are to have two choices: either the Secretary of State will tell them what to spend on school sixth forms, and how, or the national learning and skills council will tell them. Either way, local discretion is reduced. Is this to be the closure of school sixth forms by stealth? Will the right hon. Gentleman reaffirm the undertaking given in this House on 29 April by the Under-Secretary of State for Education and Employment that, whatever the outcome of the review of sixth forms, no school sixth form will close against the wishes of local parents, teachers and education authorities as a result of that review or of today's White Paper? Will the Secretary of State also confirm that anything in the review that does not build on sixth forms will be strongly opposed by the Government, as the Under-Secretary stated?
We have waited a long time for this review. The review of training and enterprise councils was first announced in May 1998. In March this year, it became clear that the results of that review had been ditched, and the Secretary of State announced that he would extend the TEC review to consider options for local and national delivery of learning and skills. Seldom have we waited so long for so much, and got so little.
The Government have had two years to get this matter right. They have produced a mishmash of proposals that leaves many questions unanswered, particularly regarding the future of school sixth forms. The proposals increase centralisation and bureaucracy, but reduce diversity, flexibility and choice. In so doing, they will damage the education and training of all learners post-16. "Preserve the best and improve the rest" should be our watchwords in all education. We want both: sadly, this statement delivers neither.

Mr. Blunkett: I welcome the hon. Lady, in her new guise, to the Dispatch Box and wish her a long sojourn in the post. I have two pieces of advice for her—one is not to be negative and the other is not to take so long.
I am sorry that the hon. Lady has not found it in her soul to welcome our announcements this afternoon, which will involve employers across the board at national and local level in a way that they have not been involved before, with spending of £5 billion—not the £1 billion that training and enterprise councils currently operate under—which will give them influence in driving the skills needs of the nation, in collaboration with all those at national and local level who have a part to play.
I made it clear, when I said that local government would have a role to play in local learning and skills councils, that we were not simply talking about rolling

together the term "employer". I say that as it is important that Conservative Members do not mislead people into believing that we are saying something that we are not. That is also true of sixth forms. I gave a guarantee this afternoon on the funding of sixth forms, and I did so on the basis that sixth forms are not threatened by these proposals.
We are talking about getting people to work together to provide real choice for young people and the highest level of efficiency. For instance, I want all providers—further education and sixth forms—to match the productivity and quality levels of sixth-form colleges. For a reduction of 20 per cent. in funding, sixth-form colleges provide the equivalent A-level points to the average sixth form throughout the country. If we can achieve that sort of quality level in every provider, we will have transformed the life chances of millions of young people.
How can I promise the House that we will save £50 million a year and be accused by the hon. Lady of creating new bureaucracy? Far from doing that, we are about to slim down a contracting system that was equalled only by the Soviet Union's wholesale distribution network. In some training and enterprise council areas, 35 per cent. of their budgets have been going on administration and staffing costs. The reality of the situation is that to gain a level 3 vocational qualification, it costs on average £3,900 in further education and £6,100 through a TEC.
If the hon. Lady is to succeed on the Opposition Front Bench, she should do a little homework, which I know she is renowned for doing, get her facts straight and understand that the new slimmed-down system with 50 sub-regional local councils and one body nationally, operating with all those who are prepared to be part of the partnership, will ensure that we deliver to our nation what we have needed for a very long time.

Mr. Malcolm Wicks: I welcome my right hon. Friend's announcement in the White Paper. It throws an encouraging light on an area of public policy that has been much neglected, albeit at some expense. May I ask my right hon. Friend about the approximately 160,000 boys and girls aged 16 to 18 who are neither in work or in education? That is about one in 11 of that age group. Will he say more about his plans for that important group, bearing in mind that some of those youngsters will have had a bad experience in their own schools and that in some parts of the country some of them may have older siblings who are out of work and dads who have recently been made redundant? How do we persuade and enable that group to take up the opportunities of a second chance—a second chance that they need and the country needs for them?

Mr. Blunkett: I am grateful to my hon. Friend. We need to do so by connecting them with the education and potential employment of the future at a much earlier stage. In many cases, we need to reconnect them with the education service that they have left through truancy or disaffection. We need to do so by building the new service connection from 12 and 13 upwards, so that it links mentoring in school with a gateway and support service for those in the transitional stage between school, post-16 and adult life.
We need to create a careers service and a 14 to 16 curriculum that relates those young people to the world of work, and ensures that they appreciate that only


through qualification will they be able to earn, secure and hold a job in the knowledge-based economy of the future. Through education and maintenance allowances, on whose pilots we are engaged, and through the other proposals that we are introducing, we shall be able to sustain them through that critical period. I hope that the report of the social exclusion unit, which will be published shortly, and the further detail that we shall publish with it, will enable the House to see that we are at last putting together the jigsaw. From sure start in the earliest years, we shall develop the needs of children from the moment that they are born until they enter adult life—giving them the opportunity of learning and work.

Mr. Phil Willis: We welcome the broad thrust of the White Paper. I do not know whether the hon. Member for Maidenhead (Mrs. May) has completed the school of charm at Smith square, but we have only to look around us, in all our cities, to see how past policies have failed. We welcome particularly the idea of co-ordinating both the planning and the resourcing of post-16 provision. We welcome the setting up of local, sub-regional councils, although we should have liked the regional development agencies to have played a more significant role, as I am sure the Secretary of State is aware.
We have some concerns as to the structure, especially whether, for example, the careers guidance will be only for 16 to 19-year-olds. Will it follow the Welsh model of a careers guidance service that is inclusive of all adults as well? We are concerned about the part to be played by the university for industry—it seems to have a separate identity, with its own structure. It may be complementary, but will the right hon. Gentleman explain why it is not part and parcel of an inclusive programme?
We were promised that we should have standards not structures. However, apart from the new inspection regime, which I am sure will be welcomed by all, there is little about standards. Why has the Secretary of State not taken this opportunity to deal with the tremendous problems relating to the professionalism and career opportunities of our further education staff? One in five full-time staff, and six in 10 part-time staff, have no teaching qualification. Is not this the place to start by giving them their own equivalent of a General Teaching Council or an institute of teaching and learning? This was an opportunity to grasp the nettle and say that our FE lecturers must have increased status and professionalism if we want this agenda to be delivered.

Mr. Blunkett: I thank the hon. Gentleman for his broad welcome for the White Paper. I assure him that the points that he makes are dealt with. May I take this opportunity to say that I delivered the White Paper to Opposition Members an hour earlier than was traditional before we took office? I am not having a go at Liberal Democrat Members; I refer to the comment made by my opposite number on the Conservative Benches, the hon. Member for Maidenhead. I want to assure the hon. Lady that her colleagues used not to do that, although, obviously, I shall be happy to try to do better in future.
The White Paper deals with the question of separating the funding regime from the delivery mechanism. The university for industry, which is a provider and a facilitator of learning, will play its part in the same way as do further education colleges and private providers.
In relation to training and quality, it is not only in further education that it is important that the new further education and national training organisation gets a grip on the needs of part-time and full-time employees; it is also important in private training provision, where almost no qualification system exists at all. We need to set up mechanisms to introduce that as quickly as possible. We share that agenda. The concordat that has been reached between the unions and the Association of Colleges and the rebuilding of industrial relations offers real hope that we can lift the morale and motivation of those in formal further education, and that we can improve quality for those in private providers.

Mr. Derek Foster: I warmly welcome the broad thrust of my right hon. Friend's White Paper, which is so important to enhancing the competitiveness of the nation and of regions such as mine and his. But may I say, as someone who has lived through many such reorganisations during the past 30 years, that the acid test of his success is whether he really will devise an employer and learner-driven system rather than one which is for the convenience of organisations, training providers and further education institutes?

Mr. Blunkett: I am grateful to my right hon. Friend. It is clear that the provider-purchaser separation will enable us to put the learner at the heart of what we are doing, through the development of individual learning accounts and the focus on individual learners, and through the involvement of employers who will, for the first time, not only locally but nationally, be able to drive the system. Getting that partnership working and getting people collaborating in a way that overcomes past divisions and conflicts rather than emphasising them will be crucial to success.

Mr. Stephen Dorrell: Does the Secretary of State agree that the whole history of taxpayers' support for post-school training in Britain, going back over many years, has been a history of substantial sums of public money, committed for the best of motives but failing to deliver its objectives, in large measure because of inadequate voice from employers and inadequate influence by employers on the way in which that money is used? If the right hon. Gentleman agrees with that analysis, can he tell the House now what single change he is proposing this afternoon that will make more effective the voice of employers in the training system and, thereby, make the training system itself more efficient?

Mr. Blunkett: I accept a great deal of what the right hon. Gentleman says about the investment of past resources. We have not succeeded in developing our productivity, competitiveness or qualification levels to anything like those of other developed nations. The greater involvement of those who have an immediate interest and who are closest to the needs of delivery are critical, not simply in this new structure in terms of their involvement nationally and locally, but by engaging the new national training organisations, of which there are now 70 since the general election, dealing with particular sectors and, therefore, needs within the economy. We wish to engage them and individual employers, including small employers, and, linked to the Small Business


Service, their enterprise commitment to making this work better. There is no guarantee that, by involving employers more, we will have a better system. There is a guarantee that, by making everyone engaged and focused on the needs of tomorrow rather than the training needs of yesterday, we might get things right.

Mr. Barry Jones: I welcome my right hon. Friend's statement, which may well turn out to be historic. Does the statement in any part refer to Wales and does it presage more apprenticeships to service our manufacturing industry, with particular reference to steel and to aerospace? Will my right hon. Friend say a little more about further education colleges, which have been having a tough time and need a boost?

Mr. Blunkett: A separate consultation has been undertaken in Wales, which the Welsh Assembly will be taking forward. We are keen to develop and build on the excellent modern apprenticeship programme. During the past two years, we have had 100,000 modern apprenticeships, and many young people are entering the programme. However, with the development from the old youth training scheme into the new national traineeships and the modern apprenticeships at level 3, there has been a real problem in terms of those finishing their training and, therefore, of retention. We need to examine with employers why that is happening and what sorts of rights of appeal and support young people can be given so that they have the same rights and investment that they would have in full-time education. As I mentioned a moment ago, we want to invest heavily in further education—as we are with the £725 million during the first two years of the comprehensive spending review—lift morale and ensure that the job can be done.
Each year, 3 million-plus learners go through further education colleges. Very few of them are the sons, daughters or relatives of those in powerful positions, particularly in our broadcast and print media. I want them to take more seriously what in France, Germany and the United States drives the link between vocational and academic education and to stop the sneers from the professional classes about what we are investing in today.

Mr. Ian Bruce: I am sure that Weymouth college and other further education colleges that run sixth forms will welcome the hint that they might get some more money for A-level students, but the rest of industry will be very upset with what the Government are saying about doing away with TECs. I am sure that the Secretary of State knows that the governing bodies of colleges such as Weymouth had to sack business governors because they were not allowed to have as many governors as under the previous Government. The input from TECs has been the reason why our economy is working as well as it will—[Interruption.]—as it currently is and, indeed, for the reduction in unemployment.
Will the right hon. Gentleman consider carefully what has happened with the new deal? One hundred thousand people have gone through the gateway without TECs being involved; 85,000 of them have found their own jobs without going into any sort of learning. People coming out of the learning options are not getting jobs. In the

12 months since the new deal has been in place, the number of people in the 18 to 24 age group who are unemployed or on a non-employment option has increased.

Mr. Blunkett: Just to put the record straight, 284,000 young people have gone into the gateway and 105,000 have had a job. The programme engages for the first time with qualification and training for all young people who are on the new deal. That never happened on the make-weight schemes that the previous regime put in place. Those young people are contributing to the lowest level of youth unemployment since 1975. Just a few facts would shed a bit of light on this subject.
The central issue that the hon. Gentleman raised at the beginning of his submission—it was not so much a question as a submission—was that employers would be annoyed with the proposals. In March, I embarked on this final review because every agency that had come forward in previous reviews—the TEC national council, the Further Education Funding Council quinquennial review, the Moser commission on basic skills, the skills task force and the chambers of commerce—all said that the existing system was in need of review. That is why we embarked on a fundamental and radical review to get it right. We are rolling with the tide in this country that is in favour of a slimmed-down system in which money is spent on learners, not bureaucracy.

Mr. Gordon Marsden: I am sure that the majority of Members agree with me that my right hon. Friend has made a statement this afternoon that shows the way forward from a system that was shambolic, inefficient and inequitable. I congratulate him on that. How does he expect the proposals to benefit and assist part-time as well as full-time students who sometimes fell through the cracks under the previous regime?

Mr. Blunkett: We are pulling together vocational and non-vocational, part-time and full-time courses and young people who are in work and out of work so that the funding tariffs and the contracting system as it exists at the moment make it possible to assist and support part-timers wherever and whenever they need it. That fits in with the programme of linking our commitment to funding for higher education with enabling those in further education to have the same opportunities.

Sir David Madel: Do the changes mean that the Government expect a pattern to develop whereby young people will do one or two A-levels in the school sixth form and the other one or two at a college of FE? Will the changes have any effect on schools that are involved in intricate negotiations with his Department on obtaining special technology status or special modern language status?

Mr. Blunkett: The changes will not affect those schools. We are committed to the substantial expansion of investment in specialist schools on the basis of their co-operation with other schools in the area and the wider community.
Young people can do one or two A-levels in a sixth form and undertake one of the new GNVQs at advanced level in a local college. It may be possible for college and sixth-form staff to work together using combined


resources. People could break down the antagonism between providers if they realised that they have a common goal, which is to meet the interests of those young people.

Mrs. Anne Campbell: I warmly welcome my right hon. Friend's statement. May I commend to him the effective co-operation and partnership between Cambridge Regional college, Hills Road and Long Road sixth form colleges and some of the school sixth forms in my constituency? Will he assure the House that his statement will offer some relief to further education colleges, given the funding pressures that they have faced ever since the previous Government imposed swingeing cuts on that sector of the education system?

Mr. Blunkett: I remember attending the Cambridge Regional college with my hon. Friend—I think it was in opposition, but it is all merged into one these days as the years pass by. Yes, we can give a commitment that, as I spelled out, students taking a course in a particular institution in the period ahead will have the same funding whichever college, institution or sixth form they attend. That seems to me to be equitable. The £400 per student for those taking three A-levels, which was announced by the Further Education Funding Council last week, is a step in that direction.

Mr. Nick St. Aubyn: In my constituency, Guildford college of further and higher education, which has just launched a new sixth-form unit, will welcome the extra money that the statement presaged. Most 16 to 18-year-old students in my constituency and in other parts of the country are in sixth forms, and for them the death knell for the sixth forms in schools up and down the country has been sounded in this statement. Will the Secretary of State confirm that his guarantee of an increase in real terms relates to an increase in prices, not wages? After all, costs increase year after year because of increased wages. Will he also confirm that he hemmed in his guarantee by saying that resources would be increased provided that numbers were maintained? Surely if extra money is given to FE colleges, their numbers will go up at the expense of sixth forms, which will have to close as a result.

Mr. Blunkett: I despair. We are about to encourage tens of thousands more young people to stay on in further education of one sort or another. That is the endeavour of all of us. We are going to great lengths to persuade them that it is in their best interests to stay on. There is no threat to providers under this system—in fact, quite the opposite. We have gone out of our way to say that we will maintain funding for sixth forms in real terms—and real terms means real terms under anyone's guarantee. I said that increases will be dependent on numbers because if a sixth form dwindles to a handful of students and the school decides that it cannot cross-subsidise to keep it open, clearly that guarantee cannot stand. That is common sense.
I appeal to the Opposition, whatever differences they may have with us about the White Paper, not to go around scaring sixth-form teachers, parents and young people by suggesting that we are about to close sixth forms. We are

about to open many more places for post-16 youngsters, because that is the future they will need to compete in the new economy of the new century.

Several hon. Members: rose—

Mr. Deputy Speaker: Order. It will be difficult for me to enable every hon. Member to make a contribution. However, brevity would help me to be more generous.

Mr. Gerry Steinberg: I welcome the proposals that the Secretary of State has announced this afternoon. Does he agree that one of the most disgraceful aspects of further education since incorporation has been its lack of accountability? For example, the Further Education Funding Council and the Department have been unwilling to intervene in some absolute scandals—and many of them have come to light in the past few years. Will the Secretary of State explain how he intends to make further education more accountable and to whom it will be accountable?

Mr. Blunkett: I thank my hon. Friend for his welcome. In chapter 3, from paragraph 34 onwards—which my hon. Friend has obviously not had time to examine thoroughly—I spell out a new, accountable system. I also do that in the same chapter in the early paragraphs about learning partnerships. The development of a local learning forum and the accountability of both the providers and the local learning and skills council—which will have to present a report, detail what they have been doing and answer for the decisions that they have taken—will be very important. It will be linked to the changes that we are making to the governance of further education, the new audit arrangements and the new inspection scheme. Together, they will form a powerful package and will ensure that we root out corruption and lack of probity and lift standards.

Mr. Michael Jack: I have had some extremely difficult constituency cases involving post-16 children with severe learning difficulties who have had great problems finding appropriate training opportunities. How will the proposals that the Secretary of State announced today benefit those disabled young people? He puts proper emphasis on the role of technology colleges. Will he explain to the headmaster of Lytham St. Annes technology college in my constituency why, on the day the Secretary of State has made this announcement, that headmaster is facing a funding restriction on the second phase of the moneys that he needs to complete his technology status position? Could the Secretary of State also provide an explanation to Mr. Reg Chapman, the principal of Blackpool and Fylde college, who wrote to me recently to say that national pay agreements exceed in percentage terms the rate at which his resources are increasing? The Secretary of State has properly emphasised FE colleges; what is his message to Mr. Chapman today?

Mr. Blunkett: I shall try to answer all three of the right hon. Gentleman's questions. On the last question, we announced a record increase in further education funding—an unprecedented 8.2 per cent. increase—in this year's Budget. My answer to his middle question is no,


I cannot. I have no idea about that technology college. However, I will write to him about that matter. As to his first question, he is right: there is a very real problem both in the transition from school to post-16 education for children with special educational needs and with the failure to transfer the statement. We must solve that problem and create a new emphasis, through the funding arrangements, to make that possible.

Mr. John Healey: The prospect of greater clarity, coherence and co-ordination of post-16 arrangements is long overdue and very welcome, as is the promise of a large input from local employers into the learning and skills councils. Can my right hon. Friend reassure other local agencies with a detailed knowledge of local labour markets and skills needs—I am thinking of training and enterprise councils, councils and the Employment Service—that their views will be taken into account by the councils as they plan and contract for the services?

Mr. Blunkett: All those engaged in the learning partnerships will be crucial to making the measure work, and their voices will be heard. The training and enterprise councils will obviously be merged into the new structure, as will the Further Education Funding Council. However, those who have given of their time and energy will be key to ensuring that there is the continuity that my hon. Friend seeks in terms of both economic development and labour market needs and concentrating and focusing on what has been lost in recent years: the skills needs of tomorrow.

Mr. Desmond Swayne: Given the importance of schools in delivering post-16 education, and in view of the statistics that the Secretary of State released last week in order to name and shame local education authorities, does he not now regret the emphasis that he placed on local education authorities in his School Standards and Framework Act 1998? Does he now regret placing back under LEA control so many schools that had escaped the dead hand of local education authority supervision?

Mr. Blunkett: First, the question has no bearing whatsoever on the White Paper. Secondly, I had an interesting experience this time last week, and it was not the local authorities saying that they loved the School Standards and Framework Act, under which I was acting. The hon. Gentleman should go back to the drawing board and do a little more homework.

Mrs. Christine Butler: I congratulate my right hon. Friend on his statement, which the sixth-form college in my constituency will broadly welcome. It is appropriate to warn Opposition Members that if they were listening, instead of reading the odd item in the newspaper, they would appreciate that almost every provider of post-16 education is saying, with the same affirmative voice, "Well done. This is just what we wanted."
There has been a disparity of almost 30 per cent. between post-16 provision in schools and in colleges. That needs to be addressed. Will my right hon. Friend tell us when he thinks the same level of funding will be available for all post 16-year-olds? Will he advise us whether the careers service will be incorporated into the new body, and whether that body will be able to tackle post-19 education to fulfil lifelong learning?

Mr. Blunkett: On the second part of my hon. Friend's question, the careers service will form the core of the new service for young people. Of course, that will also dovetail and develop with the adult guidance service—this relates to the question asked by the Liberal Democrat spokesman, the hon. Member for Bath (Mr. Foster)—so that we have a seamless provision for people across the board. I welcome my hon. Friend's question. I cannot say how long it will take to equalise funding for particular courses, but I can guarantee that it will be done as quickly as possible, given the negotiations that I shall, no doubt, be having with the Chancellor of the Exchequer in the months and years to come.

Mr. Graham Brady: My hon. Friend the Member for Maidenhead (Mrs. May) urged the Secretary of State to seek to preserve the best and improve the rest. He will know that school sixth forms in my constituency deliver some of the best post-16 education in the country. Will he reassure them that he bears no malice to school sixth forms by guaranteeing that capital and revenue funding will remain available for the expansion of existing sixth forms in schools and for the establishment of new sixth forms in schools on exactly the same terms as it will be available for the expansion of further education colleges?

Mr. Blunkett: I made it absolutely clear that we intend to expand all sectors of the post-16 arena. We want to do so on the basis of need and demand. If there is a demand for additional sixth-form places, we will meet it and we shall do so on the basis of the commitments that we have already made. I want to put on record once again that this is not an ideological decision. For the past two years, we have been making decisions on the basis of meeting that need. Sixty per cent. of youngsters between 16 and 19 in full-time education are not in sixth forms, but 40 per cent. are, and that 40 per cent. matter as much to us as they do to Opposition Members.

Mr. Barry Sheerman: My right hon. Friend will know that this statement could represent a new beginning for this sector of education. He will be aware, as I am, that any judgment made will be on the basis of the quality of education and training delivered to young people. Does he know that many employers will be thankful for his announcement because for a long time they have been putting their energy and work into training and enterprise councils, and then having all their efforts dashed by the diktat from a Department run by the previous Administration that pushed them into cheap, quick, low-value training? This new beginning will be based on the quality that we shall provide in the coming years.

Mr. Blunkett: I am very pleased to say yes.

Miss Melanie Johnson: While recognising the very many flaws in the present system and the waste and inefficiency, my right hon. Friend also recognised in his comments the good practice that exists in some areas and in some pockets. I am thinking especially of Hertfordshire training and enterprise council, which covers my constituency and those of a number of my hon. Friends. Will my right hon. Friend comment on how good practice will be secured by the developments in the White Paper?

Mr. Blunkett: We wish to build on excellence wherever it is. Some excellent work is going on through training and enterprise councils. We wish to ensure that we secure it and build on it. I shall say exactly that at the TEC national council conference tomorrow.

Mr. Richard Burden: I welcome my right hon. Friend's statement, especially what he said about locating the councils at sub-regional level, which makes a great deal of sense. I welcome what he said about the need for national targets, but I put it to him that it is vital that the new structure is flexible, building on the partnerships that already exist in many areas, linking with the Small Business Service and, crucially, with the regional development agency network. Will he say a little more about how the new structure will show such flexibility?

Mr. Blunkett: It will be possible to have flexibility within the new structure, enabling the learning and skills councils at local level, with the national training organisations and the regional development agencies, to plan what is right for their region and their sectors, so that there is much greater synergy between what is required locally and what is deliverable in terms of the funding tariffs, the contracting system and the available funds. This is a real opportunity for people to get it right in their locality.

Mr. Michael Clapham: I welcome my right hon. Friend's statement. He will be aware that the Conservatives never really understood the apprenticeship scheme, which is why they destroyed it in the 1980s. Will he ensure that the national learning and skills council promotes the national apprenticeship scheme as an alternative career structure and that, at the same time, opportunities are extended to join the national apprenticeship scheme?

Mr. Blunkett: Wholeheartedly I can. The Small Business Service will also help promote to small businesses that have not necessarily become aware of the opportunity of modern apprenticeships this high-level, high-quality opportunity to give young people real skills and hands-on experience for the future.

Barbara Follett: Given the enormous contribution made by further education colleges, such as the North Hertfordshire college in Stevenage, to their local communities, will some of their representatives be given the opportunity to serve on the new sub-regional skills bodies?

Mr. Blunkett: The answer is yes. The local learning partnerships will obviously engage a range of providers

and other interests, but they will also have representation on the local learning and skills council. It will, however, be driven by the needs of learners and employers rather than of providers, and we must get that balance right.

Mr. Ronnie Campbell: I welcome the statement as a great step forward for training and education, but will it help the post-16 kids who leave school with no qualifications and usually drift into crime and drugs and have no prospect of a job?

Mr. Blunkett: I honestly think that we shall be judged in future on whether we have made any inroads into helping those young people. Therefore, we need to come together, whatever differences there may be, to build on those interesting and challenging experiments in the voluntary sector, and on the new start initiatives, which are starting to work, so that we can reach out to those young people where they are and draw them in on terms that engage them again, not only with learning but with the community and society around them.

Mr. Hilary Benn: Is my right hon. Friend aware that many people will warmly welcome his announcement today, not least because, essentially, he has brought education and training together, in keeping with the spirit that led to the creation of a single Department for Education and Employment by the previous Government? If I may say so, that is why I think that the remarks of the hon. Member for Maidenhead (Mrs. May) were so wide of the mark.
I should like to ask my right hon. Friend a specific question about the new arrangements. Is he able to give an assurance that the support which training and enterprise councils and the Further Education Funding Council now give to trade unions to help them promote learning in the workplace will continue to be provided by the new learning and skills councils?

Mr. Blunkett: First, I welcome my hon. Friend to questions on my statement. I knew that he was going to give me a hard time in his new role.
There has been enormous co-operation in the development of work force learning and in the part that trade unions are playing. I spell out clearly in the White Paper that we want to build on bargaining for skills, on employee development programmes and on the excellent work that has been done through the union learning fund. Employers have welcomed this as a key role for agreement with trade unions. It is the future in terms of developing learning representatives in the workplace and in focusing on what benefits both the individual and his employer, which is high productivity, high added value and jobs for the future.

Several hon. Members: rose—

Mr. Deputy Speaker: Order. I am afraid we must now move on. There will be other opportunities to return to this subject.

ROYAL ASSENT

Mr. Deputy Speaker (Sir Alan Haselhurst): I have to notify the House, in accordance with the Royal Assent Act 1967, that the Queen has signified her Royal Assent to the following Acts and Measures:

Health Act 1999
Water Industry Act 1999
Tax Credits Act 1999
Breeding and Sale of Dogs (Welfare) Act 1999
Road Traffic (Vehicle Testing) Act 1999
University College London Act 1999
Imperial College Act 1999
HFC Bank Act 1999
Cathedrals Measure 1999
Care of Places of Worship Measure 1999

Holocaust Remembrance Day

Mr. Andrew Dismore: I beg to move,
That leave be given to bring in a Bill to introduce a national day to learn about and remember the Holocaust.
This year, I visited Auschwitz-Birkenau for the first time on a visit sponsored by the Holocaust Education Trust. As I went round the various blocks, I felt a sense of powerlessness and of the dehumanisation which still pervades the site. I could only wonder at the absolute terror that the Nazis' victims must have felt. The cold-blooded, methodical processing of fellow human beings was brought home to me by the huge and tragic piles of personal belongings and by the detail, such as the systematic removal of laces from the mountains of victims' shoes. The sheer scale of the operation was revealed only at Birkenau, where 1.5 million people died.
At Auschwitz, I was privileged to be in the company of 150 teachers from all parts of Britain who specialise in holocaust studies. We all came away with a sense of the overwhelming importance for all communities and for people of all ages to commemorate, and learn from, the holocaust.
I appreciated more than ever how unique the holocaust was. It was a defining episode of our century, a crisis for European civilisation and a universal catastrophe for humanity. It remains an unparalleled act of genocide in its vast scale. It was perpetrated by evil, harnessing the processes and technology of what was a modern, industrialised country.
The need to commemorate the holocaust applies in Britain as much as anywhere. Our country made terrible sacrifices to defeat Hitler. The period of Nazism and the second world war remain a defining episode in our national psyche. However, we were not affected directly by the holocaust in the same way as occupied mainland Europe.
Although the holocaust is now taught as part of the history syllabus for 13 and 14-year-olds, those aged over 25 have not been so privileged. For instance, I did not study it when I was at school. Learning about, and remembrance of, the holocaust must extend beyond formal education and childhood. It is right that our busy way of life should be punctuated by a day each year so that learning and remembrance can continue. That is why we need a holocaust remembrance day. It will provide a national focus for promoting a democratic, tolerant and respectful society. It will emphasise the positive values of Britain and of civilisation and draw attention to the consequences of the alternative.
More recent persecutions in Rwanda and the Balkans have dramatically and tragically underlined the lessons of the holocaust. Those lessons are just as relevant decades after the war as they were when Auschwitz was liberated in 1945. NATO's reasons for intervention in Kosovo graphically demonstrate that the holocaust still has a clear resonance for today's world leaders. It is vital to retain that understanding in future generations of leaders, which is why a remembrance day is so important.
The holocaust remembrance day in Britain could be marked in a number of different ways. For example, nationally, there could be a service or ceremonial occasion, perhaps including a keynote speech by my right


hon. Friend the Prime Minister, who has given great encouragement by setting up a consultation, through the Home Office, on the concept of a remembrance day. Lighting a yahrzeit candle in memory of all victims of the holocaust could form a central part of such a ceremony.
In schools, the remembrance day would emphasise that the holocaust is important and more than a mere academic subject. The day would lend itself to assemblies, school projects, exhibitions and fund-raising events. The message would extend to the wider questions of anti-racism, tolerance and respect, and of understanding the values and customs of different groups in our society.
For the first remembrance day, literature could be distributed to all households to explain the relevance of the holocaust and the importance of the remembrance day. In Sweden, for example, the Prime Minister's office has already produced a book on the holocaust to be given free to each family who ask for it. Local communities could also mark the day together with events and ceremonies in their churches, synagogues and town halls.
Those events would generate great media interest nationally and locally. The remembrance day would be a catalyst to scheduling television and radio programmes about the holocaust and related issues of genocide, racism and human rights, which would emphasise why the remembrance day is so important.
Clearly, there needs to be consideration of what is the best date for a remembrance day and we need to bear in mind the main objectives, which are to touch the population as a whole and to let schools use the day to reach out to young people. There are several possible dates, but I suggest the Monday nearest 27 January, which is the anniversary of the liberation of Auschwitz. That would be a convenient time of year for schools and would harness one of the most powerful images of the horror of the holocaust.
That date has the additional advantage of coinciding with the date likely to be recognised as holocaust remembrance day in other European Union countries.
The new Labour Government are committed to building a fair and prosperous society in which everyone has a stake and the rights and responsibilities of individuals, families and communities are properly balanced. In our ethical foreign policy, we are seeking to spread the values of human rights, civil liberties and democracy, which we demand for ourselves. Our citizenship programme in schools will be designed to teach equality and diversity, democracy, the duty to act responsibly, the ability to recognise forms of manipulation and persuasion and concern for human rights. A holocaust remembrance day would be another focus for those building blocks of a civilised society.
Each day, the link with the holocaust through its survivors is weakened as they pass away or their memories fade. It is vital to ensure that remembrance of the holocaust as a unique tragedy is perpetuated, and I believe that we should not delay in that.

Question put and agreed to.

Bill ordered to be brought in by Mr. Andrew Dismore, Ms Karen Buck, Mr. Tony McNulty, Mr. Fabian Hamilton, Mr. Stephen Twigg, Mr. Mike Gapes, Mr. Peter Bradley, Mrs. Louise Ellman, Mr. Ivan Lewis, Mr. Stephen Hepburn, Mr. James Clappison and Dr. Evan Harris.

HOLOCAUST REMEMBRANCE DAY

Mr. Andrew Dismore accordingly presented a Bill to introduce a national day to learn about and remember the Holocaust: And the same was read the First time; and ordered to be read a Second time on Friday 23 July, and to be printed [Bill 131].

Orders of the Day — Disability Rights Commission Bill [Lords]

As amended in the Standing Committee, considered.

New Clause 2

ACTION PLANS

'.—(1) The Secretary of State may make regulations to enable a provider of services under Part III of the 1995 Act to lodge an action plan with the Commission.

(2) An action plan may provide for changes to policies, practices or procedures or any other arrangements under Part III.

(3) An action plan shall comply with any requirements as to its form or its content as specified by the Commission.'.—[Mr. Boswell.]

Brought up, and read the First time.

Mr. Tim Boswell: I beg to move, That the clause be read a Second time.
Before I speak to the new clause, I make it clear to the House that I am new to the responsibility of speaking on disability issues for my party. That will perhaps become apparent in a few moments. I take up that burden with some diffidence, but with a degree of satisfaction. It is important for all of us who have constituency and other experience of these issues to be aware of the importance of achieving their proper resolution—for the individuals concerned, and their families and carers, and in respect of setting the tone of society. We must show that we have a collective responsibility and a collective readiness to care for, protect, support and empower the people who may benefit from the Bill. It will be particularly appropriate to consider whether those who are not in a position to be articulate in their own interests might be able to use the commission to advance their rights.
On a personal note, I express my gratitude to my immediate boss, the shadow Secretary of State, my hon. Friend the Member for Maidenhead (Mrs. May), who previously assumed this burden and took the Bill through Committee. I also thank my hon. Friend the Member for Tiverton and Honiton (Mrs. Browning), who participated constructively in those debates. In the same vein, may I say how pleased I am to have the opportunity to debate this matter, on this and no doubt on subsequent occasions, with the Government team? I am glad to see on the Government Front Bench the Minister for Employment, Welfare to Work and Equal Opportunities and the Under-Secretary of State for Education and Employment, the hon. Member for Barking (Ms Hodge), who had to bear the burden of taking the Bill through Committee. She has had to think about the amendments and respond to them, and one could fairly say that she has done a good job. She has come back with a number of serious amendments, which we shall discuss in due course. They reflect the concerns expressed by my hon. Friends and others in Committee and offer a degree of tidying up as well.
Given the context, and the failure to achieve consensus in the past, but also given the real advances that successive Governments have made in this area, it is right that there has been some consensus on this matter. It is in

that spirit that we move our new clause. One might almost call it "Opposition lite", in the sense that it is the only new clause that we are moving. The selectors, in their wisdom, precluded consideration of one or two other matters, which may already have been touched on in Committee.
This provision would add a new element. I recognise that the Under-Secretary is in a difficult position because this comes right at the end of our consideration of the Bill and their Lordships have already dealt with the Bill. If she does not quite like what we have said, there is not much that we can do about it, but she may be able to reflect our thinking and that of the disability groups that contacted us. In that case, we will have supplied a draft and she can decide what to do about it.
The hon. Lady knows better than I do that clause 4 sets out how the commission may make a formal investigation and serve notices on individuals or legal persons to do something about the discrimination that has been found to be practised. That is a practical and sensible approach, because the clause suggests that
The notice may require the person concerned…to propose and finalise an adequate action plan (subject to an in accordance with Part III of schedule 3)…and…once that action plan is finalised, to take any action which…is specified in the plan; and which he has not already taken".
I emphasise to the House that action can be taken only in the context of a complaint or an investigation that has shown a defect in the arrangements when someone has gone to the person concerned and said, in English, "What are you going to do about it?" That is reasonable enough.
The new clause goes further and builds on the concept by looking at action that might be taken—occasionally, my classical training comes back into my mind—proleptically, which means ahead of being forced to do it, before a formal investigation. Hon. Members with Treasury experience will be familiar with the concept of taking an idea to the Inland Revenue and saying, "We are minded to do this; would you take note of it and advise us whether it is acceptable?" That is the background to our thinking.
We are not trying to subvert the concept of action plans. We want to build on the idea and extend it to cases in which the commission has made no formal request for action. The disability interests who have lobbied us have said that it would further assist service providers and disabled people if the commission were able to be proactive, helping with the development of action plans for organisations that it was not proceeding against for discrimination. Service providers who were genuinely trying to act responsibly and take account of the Act and who wanted to be sure that they were taking the reasonable steps required of them under part III might feel reassured if their action plan were endorsed—or run—by the commission, even if that does not in itself admit to an exemption. We are not trying to produce an elaborate means of hoodwinking the commission, drawing the wool over its eyes or doing a sweetheart deal. We are saying that it would be helpful for those with a problem to be able to explain to the commission in good faith how they would like to deal with it and ask the commission for a response.
We expect the commission to be heavily engaged initially. We are not saying that it should be required to take a role on action plans if it does not want to. It could


politely decline to comment. We recommend that the commission should be given the chance to develop that side of its activity without subsequent onerous primary legislation to make that possible. Equally, the commission must have the discretion to make provision for action plans that meet its requirement to be lodged with it.
The issue of precedent is bound to be raised at this point. It was suggested in Committee that action plans had no precedent in UK law. I remember at least the concept of action plans in relation to education. We were considering education action zones in the Education Act 1993. Local education authorities or schools were required to produce them. The idea is not new. My wife is not a speaker of Welsh, but the Welsh Language Act 1967 provides for mandatory action plans, called statutory schemes, for public authorities in Wales. There is also Australian legislation that provides for similar action plans, as well as the precedent, which I have cited before, of what the Inland Revenue can do.
Nobody wants to overload the new commission. Nobody wants it to be tricked into signing up to something that is unsatisfactory or second rate. We want to enable it to give advice in good faith about plans before push comes to shove in litigation or legal process. That is consistent with many of the points that the Conservatives have made on the Bill. The Government like to emphasise the importance of partnership, consensuality and trying to get things agreed rather than people taking what I might call narrow-minded, litigious attitudes, if that can be avoided.
I refreshed my memory about that in relation to the general functions of the commission and, if the hon. Lady cannot accept the new clause as drafted—if she can, of course, I shall be delighted—I would like her to say something about the possibility of the commission's at least considering giving assistance to service providers, as part of its general duties.
The commission is supposed
to work towards the elimination of discrimination … to promote equalisation of opportunities
and
to take such steps as it considers appropriate with a view to encouraging good practice in the treatment of disabled persons".
Those are general obligations, but they might also be applicable to the particular case.
In any event, we are anxious, and the new clause is an attempt to put down a marker that says, "Let us be as constructive and flexible as possible. Let us encourage people to think about their actions ahead of the event, before they are forced to." The result could be better-planned action taken in better time, and matters might be resolved before it is ever necessary to get involved in the rather messy—and, one hopes, infrequently used—business of enforcement.
I commend the new clause to the House, and I shall be interested in any comment made about it on either side of the House, as well as in the Minister's response.

Mr. Mark Oaten: The concept of the action plan certainly has some appeal, but my concern about the new clause is that it would be in danger of adding to the several different tiers of action that the commission could take.
At present, there are three powers. The first, which we all welcome, is an education role, which involves going out and talking to organisations, working with them and trying to put good practice in place. The second, slightly tougher, power is the power to enter into written agreements. Perhaps we shall debate later whether those should be private or public. The commission can certainly say, "Something isn't right, and we need to put a written agreement in place to tie up some of the issues."
The third key area—the last resort—is the issuing of non-discrimination orders. My problem with the action plan is that it could cover any of those powers. I can envisage an action plan involving a management consultancy function, in which an organisation would want to get involved as part of its education work. Organisations could welcome the commission in and say, "Give us advice." In those circumstances, it is almost inconceivable that, by the very nature of its work, the commission would not come back with an action plan describing what the organisation should do. That would happen almost naturally, as part of the education process.
As for written agreements, I must ask: what will an agreement be about? Surely it has to be about what the organisation should do to put things right—the very point at which the action plan would, by default, apply. Thirdly, a non-discrimination order would also need to set out the reasons why it was being made, and why things needed to be put right.
Therefore, although I welcome the concept behind the new clause, I think that, by default, actions plans will be made at several stages anyway. Indeed, I would be extremely concerned if they were not, because that would make nonsense of the commission's existing procedures. On that basis, I do not support the Opposition's proposal, because it clouds the issue and would put in place a fourth tier and, because of the other powers already provided, that will not be necessary.

The Parliamentary Under-Secretary of State for Education and Employment (Ms Margaret Hodge): I welcome the hon. Member for Daventry (Mr. Boswell) to his Opposition Front-Bench position. I look forward to working with him on a whole range of issues involving people with disabilities, and I hope that there can be unanimous agreement across the Floor of the House on many of the issues that we face and the policies that we shall try to develop.
I hope that, having read our proceedings in Committee, the hon. Gentleman will recognise that we tried to respond to amendments and incorporate them if they improved the Bill. I hope that he will listen to my reasoning on the new clause and withdraw the motion.
I am sad that the hon. Member for Maidenhead (Mrs. May) has left. I have certainly enjoyed working with her on these issues. I first met her when she stood against me in Barking. At that time she was Essex girl, but now she represents the royal county of Berkshire. I do not know what effect that has had on her; I prefer to remain Essex girl, representing Barking.

Mr. Boswell: If the Minister cares to consult my CV, she will see that I was born in Brentwood. I am inextinguishably and indelibly Essex man.

Ms Hodge: A combination of Essex man and Essex girl will do wonders for our proceedings.
I agree entirely that it makes sense for organisations to plan to meet their duties under all parts of the Disability Discrimination Act 1995, including part III, and that it often makes sense to prepare an action plan. Indeed, the disability rights task force—which I am currently chairing and which is examining what further amendments may be required in legislation and what further action needs to be taken to improve civil rights for people with disabilities—has considered the issue and come to the preliminary view that action plans should be voluntary, not compulsory, for the private sector.
I also agree that the commission may want to help organisations to develop action plans. The difference arises over whether it would be appropriate or whether there is a need to make provision for regulations in the Bill to allow that to occur.

Mr. Boswell: The Minister is being very helpful. Can she confirm that we do not need to make a special provision for the commission to be helpful to those who volunteer to prepare the plans, because the Bill as drafted provides for that?

Ms Hodge: I was just about to say that. The commission can decide whether to produce guidance for service providers on the form and content that action plans might take, and there is nothing in the legislation that would prevent it from doing so. Indeed, I would imagine that the commission will find it appropriate to provide guidance for organisations seeking to fulfil their duties under part III of the 1995 Act. I hope that it will reassure the hon. Gentleman further to hear that there is nothing in the Bill to prevent a service provider from approaching the commission for advice on the development of an action plan.
I have some concerns about the new clause. I understand that the concept is drawn from the Australian legislation, which is quite distinct from ours. In Australia, the production of an action plan can lead to an exemption from specified provisions of the legislation for a specified period, as long as the service provider sticks to the plan.
Individual cases going to court in Australia are subject to a form of central control that is reminiscent of old Labour and is certainly not embodied in the Bill, which is why I wonder why the official Opposition are in favour of the new clause. A case can be taken to court only with the consent of the Human Rights and Equal Opportunities Commission in Australia. There are incentives in the Australian model to work with the commission to establish action plans.
If new clause 2 were agreed to and an action plan were in place, a disabled person could be prevented from taking action in the United Kingdom. If, for example, an organisation had adjusted the service that it provides, such as by providing signing, and a blind person entered the organisation's premises wanting to be taken somewhere, but the organisation refused to oblige, the individual could not take action against the organisation for failing to provide that additional service, which was necessary to exercise his or her rights, if there had been an action plan stating that signing provision was sufficient.
Therefore, in the United Kingdom context, an action plan could limit individuals' rights to service provision as provided by part III of the Disability Discrimination Act 1995.

5 pm

As neither the United Kingdom's current system nor the Bill provides incentives, I wonder whether voluntary actions plans—under which the commission would have power to impose certain requirements—would work.
The hon. Member for Daventry also mentioned the impact of action plans on the business community. I have real concerns about whether the provisions of new clause 2 would undermine the business community's confidence in working with the commission. As he will know, in creating the commission's framework we have been determined to engender such confidence.
The idea that our Disability Rights Commission should impose or specify action although it has no reason to believe that an organisation has broken the law does not sit well with our concepts, enshrined in the Bill, that written agreements—to which the hon. Member for Winchester (Mr. Oaten) referred—and formal investigations should begin only when the commission believes that discrimination has occurred.
For those reasons—and with my confirmation that no provision will stop voluntary co-operation and assistance between the Disability Rights Commission and organisations, or prevent the commission from giving guidance—I hope that the hon. Member for Daventry will withdraw the new clause.

Mr. Boswell: The hon. Lady has perhaps slightly over-argued her case. She mentioned a situation in which it might be impossible to deal with a particular individual's disability on the grounds that the action plan had whitewashed the general issue, making it inappropriate to apply a plan's provisions to that individual. A case can be made for that possibility, which concerned me when I considered the Bill. However, I think that if an action plan were signed on a new and different type of disability, it would not be sufficient simply to have regard to previous provision, unless it were clearly done in the context of a progressive improvement in standards generally.
I said rather little about the impact of plans on business, as I was anxious that there should be—as the hon. Lady rightly said that there should be—a coincidence of commitment, interest and involvement by business and the commission in getting the matter right. I also did not try to suggest that plans should take away individuals' rights or make matters more inflexible than they need to be.
Nevertheless—it would be churlish of me not to say so—the hon. Lady had already given me an entirely satisfactory assurance on the voluntary aspects of the commission's work. It is important—both in general education and, as the hon. Member for Winchester said, at all levels—that there should be proper collaboration and sharing of good practice. It is also very reassuring to hear that the commission may engage itself in the affairs of a particular service provider and seek to give advice.
The advice will not in itself be binding, by precluding the law, and I did not really want it to be. Nevertheless,


the advice will help people to seek and implement best practice. That is what we all want to do. I therefore beg to ask leave to withdraw the motion.

Motion and clause, by leave, withdrawn.

Clause 4

NON-DISCRIMINATION NOTICES

Ms Hodge: I beg to move amendment No. 1, in page 3, line 6, leave out 'and finalise'.

Mr. Deputy Speaker (Mr. Michael J. Martin): With this, it will be convenient to discuss Government amendments Nos. 2, 3, 6, 8, 10 to 13 and 20.

Ms Hodge: These amendments are minor and technical and have been recommended by parliamentary counsel at this late stage to tidy up the drafting of the Bill. They are designed simply to clarify the provisions in the Bill and to ensure that all cross-references are consistent. They have no effect on the substance of the provisions in the Bill. I ask the House to accept the amendments.

Mr. Boswell: I shall be brief, as I shall certainly not suggest that we divide the House on the amendments. I am rather glad that they have been tabled, although I am little less happy that they have been tabled at such a late stage.
We all know that the parliamentary draftsperson's job is a difficult one and that it is hard to get legislation right. Errors occur that have to be corrected at the end of the House's deliberations. However, it is worth noting that, although the Bill has been considered in the House of Lords—to which all hon. Members, regardless of party, would defer in matters of law—these little matters have been neglected.
Enforcement is always important. I gather that these provisions will be enforceable, in England and Wales, under section 55 of the County Courts Act 1984 and, in Scotland, under the Contempt of Court Act 1981. The provision will therefore not be self-verified under schedule 3 of the Bill.
I am sure that that will add a great deal to the sum of human knowledge, but the embarrassing situation could have arisen in which provisions that had been agreed could not be enforced. However, if the Minister says that the matter has been put right, I shall defer to her and agree to the amendments.

Amendment agreed to.

Amendment made: No. 2, in page 3, line 10, leave out
'that action plan is finalised'
and insert
'an action plan proposed by him has become final'.—[Ms Hodge.]

Clause 5

AGREEMENTS IN LIEU OF ENFORCEMENT ACTION

Amendment made: No. 3, in page 3, line 45, after 'the' insert 'unlawful'.—[Ms Hodge.]

Ms Hodge: I beg to move amendment No. 4, in page 4, line 43, leave out subsection (10).

Mr. Deputy Speaker: With this, it will be convenient to discuss Government amendments Nos. 7, 9, 14 to 17, 19 and 21 to 25.

Ms Hodge: I begin by reassuring the hon. Member for Daventry that I, too, find it profoundly irritating that the

House must consider these drafting amendments at this late stage. However, this is the first Bill that I have steered through the House, and I hope that next time there will be less need for such last-minute amendments.

Mr. John M. Taylor: Do not hold your breath.

Ms Hodge: I hear what the hon. Gentleman says. I am afraid that the comments of the hon. Member for Daventry in relation to the previous group of amendments are also relevant to these drafting amendments.
This group of amendments relates to the enforcement of orders made under clause 5 and schedule 3 of the Bill. These sections cover written agreements, nondiscrimination notices and action plans.
Amendment No. 16 is technical and simply puts right an incorrect reference to the fact that an order made under paragraph 18(3) of schedule 3 of the Bill would be enforceable under paragraph 23. In fact, the draftsmen have found that the order would be enforceable under section 55 of the County Courts Act 1984 in England and Wales and the Contempt of Court Act 1981 in Scotland, to which paragraph 23 refers.
Amendments Nos. 22 to 25 have also been recommended by parliamentary counsel, to improve the drafting of the Bill by bringing all the provisions relating to the enforcement of orders under clause 5(8) and schedule 3 together in one place—that is, under paragraph 23 of schedule 3. Amendments Nos. 4, 7, 9, 14, 15, 17, 19 and 21 are consequential on amendments Nos. 22 to 25 and would delete what would become unnecessary cross-references to enforcement.
Amendment No. 25 has been drafted to have one further effect, which I would like to cover briefly. This amendment would add a new sub-paragraph to paragraph 23 to replace paragraphs 18(5) and 18(6), which have been drafted in more general terms. Paragraphs 18(5) and 18(6) as drafted enable orders relating to action plans to be modified to alter any time limit so that in the order it is clear that the commission can return to the court for repeated fines in the case of persistent offenders. The new sub-paragraph has been drafted in more general terms so that it covers all orders—for example, those relating to written agreements—not merely those listed under paragraph 18.
The effects of the amendment are limited, as most orders have continuing effect and would not need modification in any event. However, it does mean that, where an order requires something to be done by a particular time and it is not, it is clear that the commission would be able to return to the court for repeated fines until the person complies with the order. In that respect, I hope that hon. Members will agree that the amendment improves the provisions as well as the drafting of the Bill.
I therefore ask hon. Members to accept amendment No. 25 and the other amendments in this group.

Mr. Boswell: Very briefly, I thank the hon. Lady for correcting my confusion—perhaps it was a good indication that these are complex matters. If she has, as I suspect and hope, the opportunity and privilege of bringing further legislation to the House, she will find that it is just as difficult the second time around because these things always seem to happen. It has even occasionally


been known for Opposition Members to spot the errors ahead of the parliamentary draftsperson, but I claim no credit for that. It is a complicated area to get right and it is important that the provisions for sanctions and penalties should be appropriate. The hon. Lady explained well how penalties and sanctions should work.
I draw a slight moral from all this—not in any contentious sense—in that it will be important for the commission to understand how the process works. It will need good operational rules, bearing in mind that the nature of the operation means that we do not want a series—perish the thought—of parliamentary draftspersons advising people on their disability concerns. We want people who are able to get a clear understanding of how the law operates and to explain it. That is also very important to service providers. If there is to be a cumulative penalty, as the hon. Lady explained, it is extremely important that people do not fail to comply because they cannot understand the notice that they receive.
May I alert the Minister for Employment, Welfare to Work and Equal Opportunities to the fact that I found this an interesting point? I do not dispute its legality, but it reawakened my interest in the matter even before the transfer of responsibilities when I received a letter from him stating that Members of Parliament would be required to comply with the Disability Discrimination Act 1995 in their capacity as service providers. My only reason for eyebrow lifting at that is that we are not normally paid for the services that we provide, although we are paid to be service providers.
As an example, it is commendable and perhaps exemplary that the Government have told us that we had better do our thing, and I am in no sense seeking to renege on my responsibilities to do so. Indeed, I have had to make adjustments to, and will have to make at least one further change in, the arrangements for my constituency advice bureau to facilitate the provisions; I am sure that other hon. Members will be thinking that they must do the same.
5.15 pm
Within the spirit in which this legislation has been pursued and the way in which we are debating it today, it is important that people should appreciate that the way in which it works needs to be clear. No service provider—acting as a reasonable person, we hope—should be in any doubt as to his or her obligations or as to the way in which they will be enforced if people decide or fail to fulfil them.
I have no difficulty with the provisions. The hon. Lady has explained them well and corrected my misunderstanding, in a letter that was designed to be helpful. I too would give the amendments a fair wind.

Mr. Edward Leigh: Listening to the debate one might think that we were discussing highly technical drafting matters, which in a sense we are, but the section of the Bill to which the amendments apply is the section that could cause the most problems. I therefore want an assurance from the Minister that she wants to work very much with the grain of good business practice.
In particular, I want to ask her about the agreement in lieu of enforcement action. I want a commitment from her that when those agreements are drawn up, business, in particular small business, will be able to understand exactly what is happening; and that the procedure will not be unduly bureaucratic. Will those matters be dealt with through forms or letters? How protracted will the process be? Will the commission be working on the assumption that we should normally proceed in that way rather than through more onerous action against anyone who may be in breach of their undertakings?
I very much hope that the Minister can give me that reassurance, which will be welcomed by the business community in general.

Ms Hodge: First, on information to service providers, which the hon. Member for Daventry (Mr. Boswell) mentioned, yesterday we laid before the House the code of practice that has been developed by the National Disability Council on the implementation of the first part of part III of the Disability Discrimination Act 1995, which changes policies and procedures. I hope that when hon. Members have had a chance to look at the code, they will realise that it is laid out simply, with many examples to assist service providers to meet their obligations under the disability discrimination legislation.
I am also very conscious that if the legislation is to work, the Disability Rights Commission and others will have to work closely with employers and service providers to ensure that they meet their obligations. We have taken a range of initiatives to assist service providers and employers to do just that.
I hope that hon. Members have seen the start of the "See the person" campaign, which was launched by my right hon. Friend the Secretary of State to raise awareness on disability issues a few weeks ago. That was an attempt on our part to put all disability issues more centrally on the agenda, but specifically the obligations that providers and employers have under disability discrimination legislation.
We are producing a range of new leaflets to assist employers and suppliers of goods and services; they will be available in the coming weeks. We have enhanced the DDA helpline so that organisations can use the services to assist them to comply with the new legislation.
A key duty of the new Disability Rights Commission will be not merely to support individuals to ensure that they get their civil rights in law, but to work with employers and businesses that supply goods and services to help them ensure that there is proper access and equality of opportunity for disabled people as regards employment, goods and services.
In relation to the legislative issues raised by the hon. Member for Gainsborough (Mr. Leigh), we have seized the opportunity to learn some lessons from the operation both of race relations and sex discrimination legislation, of which we have now had more than 20 years' experience. That is why we have tried to ensure that the body will work co-operatively with businesses and suppliers of goods and services, rather than in a confrontational way. We also want to make sure that action is effective; that is why the Bill provides for written agreements to be reached without having to make formal investigations. That is a better way for businesses and individual disabled people to get proper access to goods


and services, and for people to have the opportunity to work, without having to undertake court procedures. This is the first time the concept of written agreements has been included in discrimination legislation.
The Bill includes regulatory powers to tighten up formal investigations, so that they do not go on for ever with no resolution. That has been the experience in some of the formal investigations under the race relations and sex discrimination legislation; it has met the interests neither of organisations nor of the individuals subject to discrimination.
With those assurances, I hope that hon. Members will accept the amendment.

Amendment agreed to.

Schedule 1

CONSTITUTION ETC

Ms Hodge: I beg to move amendment No. 5, in page 13, line 28, at end insert—
'List of consultees
17.—(1) The Commission shall maintain a list of the organisations it has consulted generally for the purposes of any of its functions.
(2) An organisation may be removed from the list if it has not been consulted generally in the 12 months preceding its removal.
(3) For the purposes of sub-paragraphs (1) and (2), consultation is general unless it relates only—

(a) to an investigation to which paragraph 3 of Schedule 3 applies,
(b) to assistance under section 7, or
(c) otherwise to a particular individual or individuals.


(4) The Commission shall make the list available to the public in whatever way it considers appropriate (subject to any charge it may impose).'.
The amendment requires the commission to produce, and make publicly available, a list of organisations that it has consulted. I hope that hon. Members will accept that we tabled the amendment in response to the reasonable amendment tabled by the hon. Member for Tiverton and Honiton (Mrs. Browning) in Committee.
When we discussed the amendment in Committee, I said that I had sympathy with the thrust of what the hon. Lady wanted to achieve, but that I needed to look carefully at the burden that that might place on the commission, and to minimise that burden where it was practical to do so. We have, after all, said that we do not want the commission to tie itself in red tape or to waste resources. Through this amendment, I wanted to address the concerns that were expressed in debate in response to the hon. Lady's amendment. They were that the list should be useful as a point of reference and provide transparency as to whom the commission consults, but that it should not include contacts with particular individuals—such as general practitioners—in response to a particular case.
The key feature of the amendment is that the list would be publicly available, on demand. The commission could decide the best way to make it available; for example, we hope that it might be posted on the internet. That would retain the "publicness" of the list, but would be likely to reduce the cost and administrative burden of producing perhaps several thousand glossy copies—probably as part

of the commission's annual report. The list should be updated to get rid of dead-wood organisations—for example, organisations in the voluntary sector that are defunct. The amendment allows the commission to remove organisations from the list, if they have not been consulted during the previous 12 months, but does not require the commission to do so. That would mean that the DRC was obliged neither to start from scratch every year, nor to keep the list under continuous review—both of which could be administratively burdensome.
Only organisations—rather than individuals—would be included on the list, but not if an organisation had been consulted for the purposes of a formal investigation, or if the DRC was giving an individual assistance in relation to proceedings.

Mr. Oaten: If an organisation was paid for the advice it gave, would that point be attached to the provisions that the Minister is listing?

Ms Hodge: We have not specified that point, because we wanted to ensure that the list was more complete than I had suggested in our original exchange of views in Committee. For the sake of completeness, it would be best not to specify that point. However, nothing in the amendment would prevent the DRC from listing organisations that had received moneys for assisting the commission with its work.
With those reassurances, I hope that the amendment, tabled in response to representations from Opposition Members, will be accepted.

Mr. Boswell: As the Minister has reminded the House, she has been as good as her word in tabling an amendment that enshrines the concerns expressed by my hon. Friend the Member for Tiverton and Honiton (Mrs. Browning). In the rather speedy transfer of responsibilities on the Opposition Front Bench, I have not consulted my hon. Friend on the matter. However, she is aware of what has happened and has not expressed her dissent.
In relation to the intervention of the hon. Member for Winchester (Mr. Oaten), I assume that, in deciding whether to state that a charge has been made, the commission will consider whether that would colour the advice that was given, or whether such a statement would be required for accountability. I am sure the commission will be sensitive about that. The same point relates to the provision that the commission should not refer to individuals, or to formal investigation. In relation to our constituencies, we sometimes write letters on the record—indeed, for the record—but there are other occasions when we want to consult individuals confidentially in the interests of our constituents.
We realise that different types of consultation have to take place, so it is important to have a good working list, which is updated by the exclusion of organisations after a period of non-consultation and shows whom the commission has approached for advice, so that those with particular interests can debate matters on which they feel that there are gaps or an undue emphasis. That is wholly consistent with the constructive way in which we have discussed these matters.
Will the Minister comment on one outstanding matter that relates to proposed sub-paragraph (4)? I gather that there was some misunderstanding—to put it charitably—


about exactly what the Government's commitment was on charging by the commission. In correspondence, the Minister pointed out that she had confirmed, on Second Reading, that the commission would not be empowered to recover any of its legal costs from compensation awarded to individuals, or agreed outside a court or tribunal. Such costs could be recovered only from an amount for costs awarded or agreed upon—there would have to be some pre-existing agreement or a separate charge for the service given by the commission to the organisation or the individual. I hope that the Minister can reassure us on that point.
There is a general duty on public bodies—for which the Cabinet Office and others publish advice—that they should have a reasonable schedule of charges. From time to time, we all complain that some of the charges that are imposed are excessive—as indeed sometimes they are, and we are right to complain. However, such bodies should be able to institute a reasonable charging policy. If we can complain when we believe the policy to be unreasonable, and if they can explain the rationale for their charges, they should be able to implement them, subject only to the following qualification. We are dealing with people who, by definition, have some difficulties, and with organisations that are often voluntary and do not have large assets. They will not welcome heavy charging by Government or para-governmental organisations. As technology improves, no doubt much of that information may be available on the website and may be free to the user. I hope that it will be. We certainly do not want anyone who has a genuine interest in checking such material to be inhibited by a charge for accessing information.
I should be grateful if the Minister would speak to those points and give me the confirmation that I seek. I repeat my thanks and those of Opposition Members to her for responding to the point put to her in Committee by my hon. Friend the Member for Tiverton and Honiton.

Mr. Leigh: Maintaining a list of organisations to be consulted is important. I take an interest in social security matters and I serve on the Select Committee on Social Security. It is often a feature of social security matters that, compared with many other areas, there is no well funded, widely based group of natural consultees. In contrast, the agricultural sector has some of the best organised lobbyists in the country, as does defence. If one is taking a decision in such matters, there is almost an embarrassment of riches in terms of consultation. However, the number of people who are sufficiently well funded and interested in social security matters to understand the technical nature of the subject, and who are prepared to be consulted and want to submit good proposals to Government is limited.

Mr. Tom Levitt: I rise merely on a factual point to be helpful to the hon. Gentleman. He referred to a list of organisations to be consulted. That is not what this list is. This is a list of organisations that have been consulted in the course of the commission carrying out its duties. I am certain that it is not intended to be a list of the great and the good of approved organizations

for consultation. I would hope that a huge range of organisations—any organisation—could be consulted if the commission thought fit.

Mr. Leigh: I am grateful to the hon. Gentleman for clearing up that point.
The point that I want to make is that, although often on social security matters there is a dearth of people to be consulted, or who have been consulted or may be consulted, there is a well organised disability lobby, and that is a good thing. It is the one social security area on which the Select Committee receives excellent briefings from those who might be affected by a proposal. Therefore, I am not too worried about the list of consultees with regard to the disability lobby. It is good, well organised and can put its case across extremely well.
However, I am concerned with the other side of the picture—the business lobby. Full transparency is important. Two obvious business organisations that might be consulted about a proposal are the Confederation of British Industry and the Institute of Directors. However, it is often difficult for such organisations, particularly the CBI, and particularly in relation to issues that might be under discussion by the commission, to take a robust, pro-business approach, if I may put it that way. Obviously, we are dealing with a sensitive area. We are dealing with people who may have severe disabilities and no business organisation, particularly those such as the CBI, wants to receive the bad publicity that it might receive if it is seen to be unduly negative about any proposal.
The Minister presumably has an idea of the sort of people who will be consulted, and I want to be assured that the list of consultees will go further than the large business organisations, which may find it difficult, in public at least, to take a robust attitude. It is important that they should take a robust attitude, that there should be a debate about these issues and that the two sides of the argument should be put. We are potentially talking about a lot of small businesses that might find enforcement of these procedures extremely onerous. That is not because they are unsympathetic to disabled people, but simply because they have limited resources.
I use the amendment as a peg to seek the Minister's reassurance that she understands that the consultation should not simply be limited in the business world to the Institute of Directors or the CBI, but should go wider—perhaps down to a local level, such as the chambers of trade and commerce and the Federation of Small Businesses—so that we ensure that the commission has before it both sides of an argument. Unless that happens, this could be an extremely intrusive organisation which proves damaging to the interests of business and, eventually, to disabled people themselves.

Mr. Peter Luff: What I have to say follows from what my hon. Friend the Member for Gainsborough (Mr. Leigh) has just said. It relates not simply to what one might characterise as the awkward customers in the business lobby, but to the awkward customers in the disability lobby. It is clearly important that those who have clear and original thoughts should be included in the list of consultees and should be consulted by the commission.
What slightly concerns me about the amendment is that it gives the commission the right to remove from the list any organisation that it has not consulted for the past


12 months, without a right of appeal by that organisation. Whether that is a small business organisation of the kind described by my hon. Friend, or a small disability rights lobby—[Interruption.]
Labour Members disagree, but I feel a little uncomfortable when I read:
An organisation may be removed from the list if it has not been consulted generally in the 12 months preceding its removal.
I see no corresponding right for that organisation—disability rights organisation, commercial organisation or whatever—to appeal against that removal. The hon. Member for Kingswood (Mr. Berry) looks amazed and aghast at that idea, but it is entirely possible. I welcome the principle of open consultation and this addition to the Bill, but I hope that the Minister will be able to reassure us that the commission will not exclude any body—I mean body in the legal sense, not individuals—or any organisation that could reasonably be expected to be included in consultation.

Ms Hodge: I am happy to confirm to the hon. Member for Daventry (Mr. Boswell), in relation to the recovery of costs from individuals, that the Bill relates to the recovery of costs when an award for costs is made. That mirrors the position that exists for the other commissions. The Bill does not provide for the Disability Rights Commission to recover costs from compensation. Neither can they be recovered from settlements reached outside courts or tribunals, unless an amount for costs has been identified therein.
In relation to the charging policy, it will be for the commission to decide for which services it wishes to charge—for example, the distribution of papers. The commission is not expected to charge for general advice. As I said, I hope that the list of organisations will be placed on the internet where it will be free. However, if a particular organisation requires thousands of copies, it would not be unreasonable for the commission to charge.
With regard to whom the commission will consult and the specific request that it consult the business community, I reassure the hon. Member for Gainsborough (Mr. Leigh) and the hon. Member for Mid-Worcestershire (Mr. Luff) that the commission has been designed to take an evenhanded approach between those individuals who will be seeking to exercise their rights in relation to discrimination and those organisations providing goods and services to the public or acting as an employer.
It may reassure the hon. Member for Gainsborough to know that, on the disability rights task force, which I chair and which is discussing what further steps are needed to secure further comprehensive civil rights for disabled people, are representatives from not just the CBI and the Institute of Directors, but from the Federation of Small Businesses and the chambers of commerce. So we are aware of the need to ensure a broad spread of representation on that body.
We have yet to determine the precise composition of the new commission. We have not been able to do that because the Bill is not law yet, but as soon as it is, we shall ensure that it, too, reflects the broad spectrum of people who have an interest in the commission's workings. I expect there to be strong representation from the business community, the trade union movement, local government and perhaps the health service.
It will, at the end of the day, be for the Disability Rights Commission to decide whom it chooses to consult on particular issues. The purpose behind the amendment, for hon. Members who were not present in the Committee, is to ensure that the process of consultation is transparent and that when the commission comes out with a policy proposal or new code of practice, we all know who has been consulted. It was in the interests of transparency, and perhaps to meet some of the fears expressed by Opposition Members, that we have moved the amendment.

Amendment agreed to.

Schedule 3

FORMAL INVESTIGATIONS AND NON-DISCRIMINATION NOTICES

Amendments made: No. 6, in page 15, line 8, leave out 'which has become final'.

No. 7, in page 16, line 19, leave out sub-paragraph (3).

No. 8, in page 18, line 12, leave out 'day' and insert 'date'.

No. 9, in page 18, line 24, leave out sub-paragraph (4).

No. 10, in page 18, line 30, leave out 'and finalise'.

No. 11, in page 18, line 43, leave out 'and finalise'.

No. 12, in page 18, line 45, leave out 'that requirement' and insert
'the requirement mentioned in section 4(1)(b)'.

No. 13, in page 19, line 6, leave out 'time and insert 'period'.

No. 14, in page 19, line 7, leave out sub-paragraph (3).

No. 15, in page 20, line 3, leave out sub-paragraph (2).

No. 16, in page 20, line 6, leave out 'under paragraph 23' and insert
'to a county court or, in Scotland, to the sheriff'.

No. 17, in page 20, leave out lines 14 to 23.—[Mr. Jamieson.]

Ms Hodge: I beg to move amendment No. 18, in page 20, line 25, leave out 'with immediate effect'.
The amendment relates to new provisions now contained in clause 4 and schedule 3, following Committee consideration, on non-discrimination notices and action plans, to which we have already referred. The Bill as it now stands enables the commission to require a person to submit an action plan to address any unlawful acts that have been committed and which are specified in a non-discrimination notice.
The amendment relates to paragraph 19 of schedule 3, which would enable an action plan which has become final to be varied with the agreement of the commission and the person concerned. The amendment would allow flexibility in terms of when any variations would take effect. The Bill as currently drafted would mean that any changes agreed would take immediate effect. By taking out the words "immediate effect", we would enable the commission, the individual and the organisation to respond to those occasions when the commission and the person concerned wanted to agree a variation in advance.
It may help if I give an example. A person may be making provision for a disabled person in a particular way in accordance with the action plan, but realise that, on moving premises, it would be better to change the way in


which that provision had been made. The original action plan may have been that someone would work on the ground floor. In a changed premises, there may be a possibility of installing a lift that would lead to a change. In that case, the person might want to agree a change to the plan, but to provide that the change would take effect only once the move was completed.
Amendment No. 18 would remove the words "with immediate effect" in paragraph 19 and thus leave it to the parties to decide, as part of their agreement, when any variation would take effect.

Mr. Boswell: The Government are importing a welcome measure of flexibility into the provisions, which are already fairly flexible. We are pleased that they are moving the amendment. It means that we will not be tied to having everything done immediately. I imagine that it would be possible to contrive to overcome that problem by providing that the variation should be agreed and come into effect on the day on which it was necessary, but then one could have a series of rather complicated provisions leading to a series of variation orders or agreements. So it is probably sensible to proceed as the Government are doing.
The only point on which I seek assurance is that there is no scope for monkey business and non-compliance with the action plan. If the instruction is that the thing should take immediate effect, that is fairly easily pursued, judged and, if necessary, proceeded on. If some date in the future is stipulated, especially if it relates to a contingent event that may not be easy to define, such as "the day I finish moving house", which may not even be easy for a court to determine, the situation will be a little vague. I hope that that can be overcome. I do not think that it is an objection to proceeding with the amendment.

Ms Hodge: There is absolutely no intention of using the amendment to weaken the facilities in the Bill to eliminate discrimination. I simply draw it to the hon. Gentleman's attention that it would require the agreement of all parties to vary the timing of implementation of the action plan.

Amendment agreed to.

Amendments made: No. 19, in page 20, line 37, leave out sub-paragraph (4).

No. 20, in page 21, line 6, leave out 'this sub-paragraph' and insert 'sub-paragraph (3)'.

No. 21, in page 21, line 9, leave out sub-paragraph (5).

No. 22, in page 21, line 37, leave out from beginning to 'with' in line 39 and insert—
'(1) This paragraph applies to any order made by a county court or the sheriff under section 5(8) or under any provision of this Schedule.
(2) Section 55 of the County Courts Act 1984 (penalty for failure to give evidence) shall have effect in relation to a failure to comply with an order made by a county court to which this paragraph applies'.

No. 23, in page 21, line 43, after 'under' insert 'section 5(8) of or'.

No. 24, in page 22, line 6, leave out from 'sheriff' to end of line 7 and insert
'to which this paragraph applies'.

No. 25, in page 22, line 14, at end insert—
'(3) If the Commission applies to a county court or, in Scotland, to the sheriff to enforce an order to which this paragraph applies, the court may modify the order.'.—[Mr. Jamieson.]

Order for Third Reading read.

The Minister for Employment, Welfare to Work and Equal Opportunities (Mr. Andrew Smith): I beg to move, That the Bill be now read the Third time.
The debates on this Bill on Second Reading, on Report and in Committee have been good-spirited, as befits a thoroughly good measure. The standing of the commission will be all the stronger and its work all the more effective for the breadth and depth of support now being expressed for its establishment.
The consensus behind the commission is such that I have no need to detain the House with a prolonged speech. I should just like to say that securing this commission is a great tribute to all those who have campaigned long and hard to bring it about. A debt of thanks is owed to the people involved from disability organisations and in the general public, to many Members of this House and another place, to the disability rights task force and to the all-party disablement group. It can be a bit invidious to single out names, but I know that the House would want to join me in voicing particular thanks for the pioneering work of Jack Ashley and Alf Morris, which comes to fruition today in this Bill.
I should also like to thank all hon. Members who served on the Standing Committee, and the Opposition parties for their constructive contribution. This was a very good Bill when it started its passage through the House, and it is an even better Bill now. I should also like to thank the civil servants, the parliamentary officials—and Hansard staff and the police—and all who have worked on the Bill's proceedings. It is all the better for their invaluable input.
May I say a particular thank you to my hon. Friend the Member for Newport, East Mr. (Howarth), who put a lot of work into getting this Bill under way, and to my hon. Friend the Under-Secretary, who has thrown herself body and soul into seeing the Bill through so successfully in a good spirit of partnership with disability organisations and others.
We will now at last have a proper independent body to help disabled people to secure their rights. Together with the work of the disability rights task force, the extension of the Disability Discrimination Act 1995, the new deal for disabled people, the disabled persons tax credit and income guarantee and the hearts and minds campaign, this measure marks decisive progress towards comprehensive civil rights for disabled people.
The establishment of the Disability Rights Commission and the action that will flow from that are achievements of which this Labour Government, the disability rights movement and the whole House can be proud. What really matters is the difference that it will make in the lives of disabled people as we open up opportunity, challenge prejudice and discrimination, and enable people to live lives of dignity and fulfilment. The Disability Rights


Commission has an enormous role to play. It is long overdue. Disabled people have waited more than long enough. Let us give the Bill a Third Reading so that they wait no longer.

Mr. Boswell: The Minister moved Third Reading in a broad and generous spirit. He has expressed thanks to almost all parties, and rightly so. I shall not repeat those thanks, not because I do not share his sentiments but because they have already been expressed. He injected the minimum of partisanship. That is proper because although we may have had our differences in the past on some disability issues, we have now all come together on this measure. It is right that occasionally in this place we find ourselves all on the same side, just as it is entirely right that on other occasions we vigorously debate matters of political tension and hardship. I think that we have found the right balance in this instance, and it respects the circumstances of the case.
I shall not repeat those thanks; I shall merely refer to my diffidence, in that it is almost unprecedented for me to have my first outing on a Bill on Report when others have done all the spadework. However, I believe that even in these short contributions I have reinforced the attitude that we have taken on these matters.
As for how the Bill will work, we have obtained useful assurances and, as the Minister rightly said, the Bill has been improved in response to points made by hon. Members from both sides of the House. The first matter that should concern people is whether the commission will have sufficient resources to do its job. We shall have to see whether there is a sudden flood of cases that have been pent up and not adequately developed. I hope that they can be managed, and that the commission will have the right resources to keep that under review.
The second major concern will be the way in which the commission approaches consultation with the service provider and the business interests that my hon. Friend the Member for Gainsborough (Mr. Leigh) mentioned in several interventions. The Under-Secretary referred to the need for maximum discussion to achieve positive results without cracking the legislative whip. I am sure that that is the right general approach, and I am relieved that that view is shared across the House.
It would be unfortunate if this measure were seen not as a matter of civil rights—I do not dissent from that view—but as a fruitful vehicle for contention and litigation whenever possible. The moral should be to improve awareness and consciousness, to move on to good practice and—if necessary—prescription, and to introduce the big stick only when absolutely necessary and when there is recalcitrance. I do not wish to take away the obligations of employers or service providers, but they should have a chance to behave reasonably. My strong hope and belief is that most of them, given that opportunity, will want to manage their affairs in such a way as to be helpful to the interests of persons with disabilities.
My concluding remarks will be addressed to people with disabilities as they look forward to their new rights. It is important that we do not oversell what we have achieved in the Bill. That is in no sense to diminish its importance or the fact that we have reached agreement on it, but it does not, by itself, remove discrimination and

deal with entrenched attitudes and insensitivity. Perhaps no one could legislate to deal with those problems effectively. We must do what we can in legislation, but we should realise that litigation is a difficult process, and for persons with disabilities it is even more stressful.
Having just come to this issue, I was struck by the survey carried out by the university of Sussex for the Institute for Employment Studies, which examined the cases brought during the first 19 months under the Disability Discrimination Act 1995. It interviewed 180 parties and 40 lawyers in 92 cases, and found that the process was daunting and that the problems for disabled people of being in court were enormous. That is undoubtedly true. The assistance of the commission may help to support some of these cases appropriately.
It is important that if attempts to enforce rights come to litigation, lawyers on all sides should bear in mind the circumstances of the parties. We cannot tolerate a situation in which public authorities, private employers or service providers sit it out in the hope that the problem will go away through what was once memorably and chillingly called the biological solution. The answer is to give people their rights and to understand that there will be differences of interpretation. The commission must be used positively and constructively to articulate and determine the rights of disabled people, and to find a practical way of resolving the problem. If possible, it should not become a battleground between the political parties or employers and service providers and persons with a disability.
This is a sensitive issue. I am encouraged by the way in which all parties have worked together. The Government and other parties have worked to try to produce the best possible outcome. We must cast it into existence on Third Reading, with Lords consideration completed, and on to the tide of history. We hope that it will flow in the direction we all want it to flow. I believe that the spirit in which we are dispatching it may modestly help to bring about that objective.

Mr. Roger Berry (Kingswood): I warmly welcome the Bill, personally and on behalf of the all-party disablement group. I am sure that the many disability organisations that this afternoon issued a press release welcoming the Bill would also wish me to say on their behalf how welcome it is.
The hon. Member for Daventry (Mr. Boswell) said that we should not overstate the importance of a Bill to establish a Disability Rights Commission. I tend to think that there is a great danger of underestimating its significance. It is easy to say that this is an historic occasion for 9 million disabled people in Britain. We have said that before, but it remains true. The more I reflect on the Bill, the more I suspect that we are not yet clear about what its effects will be. I believe that they will be extremely far-reaching.
As of today, there is no statutory body to assist in promoting equal rights for disabled people. The Equal Opportunities Commission and the Commission for Racial Equality deal with discrimination on the grounds of gender and race, but there is no statutory body to assist in tackling discrimination against disabled people. Yet we know that the extent of that discrimination is very great—whether it is in employment, education, housing, transport


or in any other area of human life. Therefore, I believe that the Bill is profoundly important. It is a measure for which campaigners outside and inside the House have worked for almost 20 years.

Mr. John Healey: My hon. Friend talked about the Bill's campaigners, but no one has worked harder or for longer than he has for this measure. Does he agree that one feature that gives cause for optimism about the implementation of the Bill and the new commission is the wide support that it has received not just from disability organisations but from employers' organisations, including the Employers Forum on Disability, the Confederation of British Industry and even the Institute of Directors, which has welcomed the Bill with reservations?

Mr. Berry: I am grateful to my hon. Friend for those kind comments. I agree very much with his point. I welcome, with the greatest possible enthusiasm, the extent of support for the Bill. One cannot forget entirely the fact that the previous Government were forced to introduce the Disability Discrimination Act in 1995 after years of doing everything imaginable—and even things that I thought were unimaginable—to block that legislation.
One of the most glaring omissions from the Disability Discrimination Act was the lack of any effective enforcement mechanism—the lack of a commission, for which many people had argued at the time. The then Government established the National Disability Council, and it is no criticism of its members—they have done a very good job and I pay tribute to the chair, David Grayson, and his colleagues—that it was never given the power or the terms of reference to do what was necessary. The National Disability Council is the only Government agency that I can recall that campaigned for its own abolition almost from day one. It recognised that we needed a commission, and the Bill will deliver that commission.
Let us be perfectly frank: change has come about first and foremost because we have a Labour Government. Let no one pretend that we would today be debating the Third Reading of the Disability Rights Commission Bill without a Labour victory at the last general election. We are debating the Bill also because the Government have moved with great speed: they found the legislative time to introduce this legislation within a mere two years of taking office. I believe that is a great achievement, not least because of the enormous pressures on parliamentary time.
Every right hon. and hon. Member must be bombarded, day in and day out, with requests for the Government to do this, that and the other—and, in most cases, we agree with all of those requests. That suggests that an enormous amount of legislation is required after 18 years of Conservative Government. The fact that the Government have found the time and given priority to establish a Disability Rights Commission within two years of the general election is a tribute to them and to their commitment to tackling discrimination against disabled people.
I also acknowledge the fact that the disability rights task force, to which my right hon. Friend the Minister referred, has been very effective in advising the

Government and in facilitating a dialogue between them and not only disabled people but employers, trade unions and all of those who have a legitimate interest in this field. That reflects an inclusive approach to policy making that should be welcomed warmly. In their press release this afternoon, the disability organisations particularly applauded the fact that they have been involved in the process. They have been consulted and listened to and they feel that they have ownership of the exercise. That is how Government Departments should operate, and I congratulate my colleagues on functioning in that way.
In this month's Royal Association for Disability and Rehabilitation bulletin, the organisation's director, Bert Massie, says:
It is a credit to disability organisations and the Government that this milestone in the rights of disabled people had been reached less than halfway through this Parliament.
The disability organisations are correct, and I join them in congratulating my right hon. Friend the Minister and the Under-Secretary of State for Education and Employment, my hon. Friend the Member for Barking (Ms Hodge), on the way in which they have steered the legislation through Parliament and have consulted and listened to people.
Many improvements were made to the Bill in Committee, and some were made on Report this afternoon. As a result of contributions made on Second Reading and of proposals advanced by disability organisations throughout the whole process, we have a better Bill.
I also place on record my appreciation—and I am sure that of the House—of my hon. Friend the Member for Newport, East (Mr. Howarth), who was the first Under-Secretary of State after the election to have responsibility for disability issues. I worked with him when we were in different political parties—I hope that those on his Front Bench knew about it at the time—and I pay tribute to him now that we are in a better position: namely, members of the same party.
I think that disabled people and the Government have an enormous amount to be proud of today, but there are others for whom this is also an important milestone. I refer first to the Conservatives. I congratulate the hon. Member for Daventry (Mr. Boswell) on his new post. It was a pleasure to share a platform with him at a meeting organised by Sense and Deafblind UK at the end of last week, and I wish him well. The hon. Gentleman will recall that the Conservatives are recent converts to the need for comprehensive and enforceable civil rights for disabled people—I offer that comment merely as a fact. Therefore, support for the legislation is an important milestone for the Conservative party, and I welcome it most genuinely.
The Bill is also a milestone for many other people—some of whom are perhaps not aware of it. I have in mind employers. Equal opportunities is about much more than equal access to rights and responsibilities. Effective equal opportunities means that employers can be certain that they have employed the best person for the job. Without an effective equal opportunities policy, how can any business know that it has found the most effective employee? Finding ways of overcoming the prejudices and the barriers to employing disabled people allows businesses to employ the best person and to become richer in every sense. Today is a milestone for employers up and


down the country because the Bill will help them to ensure that they are employing the best people for the job, irrespective of any disability that they might have.
When the Disability Rights Commission opens its doors on 1 April next year, not only disabled people will seek its assistance to overcome discrimination: I think businesses will also queue up for advice and information about how to open themselves to the wider community. Those will be the businesses that, to paraphrase the slogan from the current campaign, want to see the person, and understand that social inclusion is about social justice and economic efficiency.
Hon. Members will be aware that I do not often quote President George Bush with approval but, on this memorable occasion, I will. When he enacted the Americans with Disabilities Act in 1990, he said that it would
let the shameful walls of exclusion finally come tumbling down".
That is what the Bill will help to achieve in Britain. It deserves the unanimous support of the House, and I am delighted that it will, in all probability, receive it.

Mr. Oaten: It is a pleasure to follow the hon. Member for Kingswood (Mr. Berry), who has done an enormous amount of work in this field. He must be very proud today that the Bill is being passed. We can see the obvious pleasure and delight that he takes in that, and he displayed more pleasure than he did when I last heard him speak in the Chamber.
I warmly congratulate the Under-Secretary of State for Education and Employment, the hon. Member for Barking (Ms Hodge), who mentioned earlier that this is the first Bill that she has taken through the House. It has been a pleasure to watch her doing that with incredible openness. Certainly in Committee, she was very open to points made by Opposition parties. As a new Member who has been somewhat disappointed by the yah-boo politics in this place, I find it refreshing to play a small part in a process in which I have seen how politics can work in an extraordinarily constructive way. I congratulate the Minister on her role in that.
Clearly, Liberal Democrat Members welcome this important landmark in disability legislation. I do not want to hold up the House, because many of the points were made on Second Reading and we have debated the Bill at length. The legislation is long overdue, and the process that we have undergone today has strengthened existing legislation. We have passed a Bill for which disabled groups have been arguing for many years, and we can all be proud of having played a part in that.
There are, however, challenges ahead for the Disability Rights Commission, and we should not be so enthusiastic that we do not recognise that it will face difficult hurdles. Sadly, attitudes are still very tough, and that is why we need such an organisation. Although businesses and the public have certainly changed their attitudes towards disabled people, we still badly need the commission, and it will have many obstacles to overcome, not least the limits on its powers in the areas within which it will be able to operate.
I know that the Government have made it clear that they hope to extend the Bill's provisions to education, policing and transport. Those are fundamental areas,

and although the commission will be able to make good progress in the areas included in the Bill, it will find it hard to make progress where there is no legislation for it to enforce. If we are to take a holistic—I hate that word—approach to disabled people, having two such fundamental areas as education and transport outside the Bill's provisions will restrain progress. I hope that the commission will work with the Government to ensure that those areas are brought within the scope of its powers.
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Similarly, I have concerns about the commission working with business. It is a shame that not all businesses are included in the Bill. Those with fewer than 15 employees are exempt, which means that about 80 per cent. of companies are excluded from the Bill's provisions. It must be an urgent priority for the Disability Rights Commission to bring that to the attention of politicians and to put pressure on and work with the Government to change that threshold. It will be difficult for the commission to send out a positive message and to educate businesses if many are not legally required to comply.
We have spoken in previous debates about the Disability Rights Commission's requirement for resources. I have taken comfort from the Government's comments about that. That position needs to be monitored; otherwise, we may find that in two or three years the commission's education work expands, as we hope it will, and its resources are too stretched to allow it to help individuals who are trying to be positive and making constant demands for help. If the commission had to refuse help to those people, and it was unable to begin charging them for help, that would be a missed opportunity, and the funding would have to be reconsidered.
I referred earlier to the three-tier process of education, written agreements and the final resort of nondiscrimination notices. I am assured that it is sensible, and I think that it will work well. I am slightly concerned about the written agreements, and when the Minister winds up the debate, I should welcome a little more clarification about whether those agreements will be public.
I understand the need to have a positive dialogue with businesses, so that they feel that they can be open about their difficulties. It would not be helpful if that was all made public. Nevertheless, if those written agreements deal with serious cases in which the commission believes that a company has failed in its duties, and an agreement is the last stop before issuing a non-discrimination notice, the public, the company's work force and people who may want to apply to the company have a right to know about the concerns expressed in the agreement. Private written agreements could prevent businesses from being accountable.
A concern that has not been allayed by the amendments relates to the commission's ability to try to tackle organisations that may be about to act in a way that is anti disabled people. It will be difficult for the commission to deal with such problems. It will need to work on events that have already happened, where it believes that the company's actions are discriminatory.
We can all think of examples in which companies may be preparing to act in a discriminatory manner. I am thinking particularly of the building trade, which I mentioned in Committee. Builders may be about to take


action that is discriminatory because they have not built a building in the right way or they have not complied with the Government's new legislation on building requirements, but the commission will not have the power to step in at that point. That is a disappointment, because it must be better to try to tackle discrimination before, for example, a disabled person turns up at a house and cannot get inside. Clearly, at that point, the building company will have committed an offence. When the commission is up and running, it will come across such difficulties week in and week out, and those will have to be reconsidered in the future.
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This is a super Bill, and we should all be proud of taking part in its consideration. I envisage having to call the commission in a year or so to check that I am myself complying with the provisions and to get help and advice. In a city such as Winchester it is difficult to get offices and buildings converted. As an MP, I have found it extremely difficult to find out how I can follow good practice. The commission will face many demands to do the part of its work that we all want it to do—persuading, educating and taking a positive approach. I am reassured, however, that when things go wrong and that education does not work, the commission will be able to take a firm hand. By putting that provision in place, the House sends those organisations who want to ignore the disabled a strong message that they can no longer do so. We have created a body that will be on their case, and I warmly welcome that and the Bill.

Mr. Gordon Marsden: I am delighted to be able to speak in support of Third Reading. The Disability Discrimination Act 1995 made an important start in providing disabled people with rights of access to employment, goods, services and premises. Yesterday, the Under-Secretary of State for Education and Employment, my hon. Friend the Member for Barking (Ms Hodge), acknowledged to the Select Committee on Education and Employment, of which I am a member, that the first two or three years of that Act's operation had provoked cases and a momentum similar to those created by the Sex Discrimination Act 1975 and the setting up of the Equal Opportunities Commission. Bearing in mind the positive contribution that they made to transforming our society, the Disability Discrimination Act was a good start.
However, the 1995 Act did not provide a platform from which individuals could make a progression. It was a blunt instrument. I believe that the Disability Rights Commission, which I hope that the House is about to bring into being, will give an edge and a temper to everything for which disability campaigners have fought for so long.
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I share the delight of my hon. Friend the Member for Kingswood (Mr. Berry) that a Labour Government are introducing the Bill, but it is only fair to say that it builds on the efforts of members of all parties. I add my tribute to my hon. Friend the Member for Kingswood, but I also pay tribute to the hon. Member for Tiverton and Honiton (Mrs. Browning)—and to the hon. Member for Daventry (Mr. Boswell), who presented the Opposition's position very constructively this afternoon.
The Bill ties in with the overall thrust of Government policy to aid and empower disabled people—the new deal for disabled people, the special educational needs Green Paper, the new role for personal advisers in the single gateway, and other measures that the Government are bringing forward, which are giving teeth to the Tomlinson report proposals.
I am delighted that the Bill is being taken through the House by my hon. Friend the Under-Secretary who, as others have said, has displayed great energy and commitment in doing so. In one of her first engagements in her position, she visited my constituency to meet the Blackpool Bears, a disabled sports group that has done admirable work in the Blackpool area.
As an example of joined-up government, I also pay tribute to the work of the Under-Secretary of State for Social Security, my hon. Friend the Member for City of York (Mr. Bayley), for the thought-provoking way in which he has dealt sensitively with the issues surrounding disability that hon. Members have brought to his attention.
The Disability Rights Commission embodies four essential ingredients. It is a spur to cultural change; it is a source of central advice and information; it is a practical source of redress; and it is an empowering device. I believe that it will have a key role to play in a range of areas.
I believe that the extension of the 1995 Act in October of this year for service providers will give a major new impetus and an added edge to the type of work that the commission takes on board. I believe and hope that it will provide a major boost and support system to the many voluntary sector organisations that, together with the pressure groups, have been a lifeline to disabled people. Despite the new and welcome emphasis by the Government on working with them, we tend too often to take for granted the contribution of the voluntary sector in this respect. However, the voluntary sector, its volunteers and its organisations are often the backbone of civil society.
I have just returned from a visit to Russia, where the health of that nascent democracy is much debated locally. One of the most impellent gaps in Russian society today is the lack of that voluntarist tradition and that voluntary principle. We should never take them for granted. We should always be extremely pleased and proud of the voluntary work that is done in our country.
In my constituency, the Disability Services Organisation for Blackpool, Wyre and Fylde, of which I have the honour to be president, will welcome the umbrella opportunity that the Disability Rights Commission offers. It has several different initiatives, offering free independent advice and a volunteer service for disabled people with sensory and physical disabilities, jointly financed by Blackpool council, Blackpool social services and North West Lancashire health authority. It has achieved a great deal in buying and leasing scooters and wheelchairs, shop mobility, a dial-a-ride scheme and a disability information service. It has now obtained a £30,000 grant from the Millennium Commission to make and produce a disability awareness video for people in the north-west. All such organisations will benefit from the support and encouragement and the umbrella function of the Disability Rights Commission.
All those aspects tie in with the need to strengthen disabled people's rights, not by condescension or toleration, but by giving them their proper rights


in society. If I may be forgiven a historical reference, that has so often been the route that minorities have had to tread in our society—beginning with condescension, moving on to toleration and finally achieving full civil rights.
The new commission will need to be aware of, and especially sensitive to, the increasing involvement of disabled people in voluntary and statutory bodies—in school boards of governors, in health trust boards and in tribunals. However, along with that goes a responsibility on those bodies that welcome disabled people to give them the proper support and encouragement, and to anticipate the need for time off and the need for appliances with which to do their job properly. Disabled people should not have to go to them cap in hand. I hope that the new Disability Rights Commission will strengthen their voice in that respect. I believe that, with increased participation by disabled people in public bodies, in ministerial Departments and in local councils, the DRC will have a very important role to play in using its powers to be proactive.
I add my voice to those who have spoken about the excellent new publicity campaign—the "See the Person" campaign—because that is all about inclusion. I too, welcome the fact that businesses—especially small businesses, of which there are many in my constituency—will be involved in that process. It is important that businesses recognise that disabled people are about "what I can do, not what I can't do".
Often, unwitting and unthinking discrimination is a major element in the barriers to disabled people. It is the so-called "Does he"—or, for that matter, does she—"take sugar?" syndrome, of which I have some personal experience in my family through my mother, who is disabled.
The Disability Rights Commission has a very important role to play in encouraging and developing codes of practice. It has a particular opportunity at this time to encourage new administrative organisations—the regional development agencies, the new unitary authorities, the Scottish Parliament and the National Assembly for Wales, all of which start with a clean slate.
The DRC has a very important encouraging role. Tonight, I especially want to highlight the issue of tourism. I am very pleased that the Department for Culture, Media and Sport document "Tomorrow's Tourism", published earlier in the year, acknowledged the needs and concerns of disabled people. It recognised that an estimated 4 million disabled people in the United Kingdom want to take a holiday break but do not do so. Holidays and leisure breaks, to an extent which people who have no experience of disabled people and their carers often underestimate, can be a lifeline to those people, but often it is very difficult for them to take holidays.
I believe that the Disability Rights Commission will provide a welcoming context for initiatives that are already under way, such as the Holiday Care Service and Tourism for All. I hope that the commission will be able to encourage the industry and the providers to take on more disabled people in the tourism business and to welcome more holidaymakers into their establishments. I am delighted to say that many hoteliers in Blackpool—incidentally, in some of the smallest establishments—have already made good progress in that respect.
In the final analysis, the commission's power to help individuals with complaints under the 1995 Act is terribly important. There is an old Quaker adage that he who would do good must begin with doing it in minute particulars. In that respect, we must always remember that, although disabled people are individuals, whose struggle and sense of self-worth is very important to them as individuals, they also act as beacons—as champions—for others in that area.
I see the Disability Rights Commission as a milestone on that path, which was so nobly inaugurated by Alf Morris and Jack Ashley, who have rightly been paid tribute to today. There was once the saying, "Give us the tools and we will finish the job." Today, with the DRC, effective tools have been provided. I commend the priority that the Government have given to it. I commend also the enthusiasm with which it has been received by those on both sides of the House. I am delighted to support Third Reading.

Mr. Edward Leigh: In his introduction to the White Paper concerning the Bill—"Promoting disabled people's rights—Creating A Disability Rights Commission fit for the 21st Century"—the then responsible Minister, who is now the Minister for the Arts said:
We do not believe there should be any tension between the interests of disabled people and the interests of employers or of providers of goods and services; rather the contrary.
He added:
A Disability Rights Commission … will be an agency of benign change.
Let us hope that the hon. Gentleman is right. I sincerely hope that the Bill will be an instrument of benign change. In the right hands, it can be. In the wrong ones, it could be an instrument of intrusive over-regulation that could work against the interests of disabled people.
I was thinking about the Minister for the Arts only yesterday when I was clearing out an old wardrobe that I had inherited. In it was a newspaper of 28 May 1979, from the early, heady days of the previous Conservative Government. There was a long article in it about the new head of the Conservative research department, one Mr. Alan Howarth. Let us hope that what is created today does not end up in the same way as a fading newspaper article in a dusty old wardrobe. I do not think that it will.
What we are about to pass into law is important. I do not want to be churlish. I accept that the Bill is a great victory for those who campaigned for it over many years. I took part in those debates in the middle part of the previous Parliament when the disability legislation of the Conservative Government was before us. I have no worries with what my right hon. Friend the Leader of the Opposition said on 24 November 1994, when he was the Minister for Social Security and Disabled People. He said that the then Conservative Government believed that it should be possible to enforce legislation without setting up an expensive bureaucracy to police it. That is my view.
We should be able to live in a society where disabled people feel that they have rights and that those rights can be enforced. Equally, I hope that we understand that creating an expensive bureaucracy and, in the words of my right hon. Friend the Leader of the Opposition, enforcing it can be extremely dangerous.
I thought that MENCAP put the matter very well in its contribution to the all-party disablement group's Second Reading briefing, when it said:
There are men, women and children who have hitherto been awarded protection from discrimination in theory but who have been left without a supporting mechanism for redress of grievances in practice.y
I agree with that statement. It is perhaps wrong for society to try to make itself feel comfortable by introducing legislation that it is impossible to enforce in practice. However, following the long debates that we have had over many years, I think that there is always a right time for doing things. Perhaps this is the right time for the Bill. However, as we pass it into law, I believe that we should consider carefully the representations that have been made to us by employer organisations, particularly by the CBI and particularly in relation to what it has to say about non-discrimination notices, as referred to in clause 4.
We have only to read clause 4 to realise that we are talking about a commission that potentially will be very powerful. The clause reads:
If in the course of a formal investigation the Commission is satisfied that a person has committed or is committing an unlawful act, it may serve on him a notice (referred to in this Act as a non-discrimination notice) which … gives details of the unlawful act … and … requires him not to commit any further unlawful acts".
That is a great power.
I realise that those who speak in the debate have fought for many years for rights for the disabled. Why should they be primarily concerned about burdens on business? My only plea is that we ensure that we have a balanced debate, and that what the CBI has said about the potentially huge powers contained in the Bill is taken to heart by the Government. I hope that they are prepared, willing and undertaking to act in the benign way that the hon. Member for Newport, East (Mr. Howarth) was talking about when he introduced the White Paper.
I agree that we must move from an era where disabled people had no rights. Indeed, they were heavily discriminated against. We must move from an era in which there is perhaps an element of condescension. We must then move on to an era where we do not talk constantly, as we often do in the social security world, of benefits for disabled people. Instead, we must move them into the world of work.
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The Bill, if it is used in the right way, can be a benign measure for moving disabled people out of a ghetto, or the ghetto, into the world of work. However, if the commission is placed in the wrong hands, it could do a great deal of harm. I note that the majority of the commissioners will be disabled people. They will have to take a broad-minded attitude. They will have powers that they have not been enjoyed before. They are no longer a lobby outside knocking on the door. They are now inside the establishment, and they will be wielding great powers. I very much hope that, as we pass the Bill into law, they will feel that it is their duty to act in a balanced way in the interests of society as a whole, including the interests of disabled people and those who wish to provide jobs for them.

Mr. Tom Levitt: I think that I am the only Back-Bench Member who has sat through, and spoken on, every stage of the Bill's passage through the House. I am delighted that we have reached where we are today.
On various occasions, I have said to Conservative Members, "Remind me, why was it that you voted against similar measures time after time years ago?" Until the past few minutes, they could not remember. The hon. Member for Gainsborough (Mr. Leigh) obviously has stronger memories than other Conservative Members. I do not mean this unkindly, but the warmth that has emanated from repenting sinners has given great joy to Labour Members. I thank them for the contributions that they have made to our debates during the various stages of the Bill.
I say in response to the remarks of the hon. Member for Gainsborough that the Bill is a milestone and not a millstone. It is a step forwards, not a step backwards.
I shall make only two points, and the first concerns the awareness—for example, of employers and service providers—of the needs of disabled people. The present campaign is a stimulating one. It produces smiles and, perhaps, controversy but it gets people thinking, which is important. That is a role that the Disability Rights Commission will have to take on in future. In terms of awareness raising, it will be looking to good practice and disseminating it.
At the launch of the campaign—it is a good example to put on record—there was a contribution from B and Q. It spoke of its employment practices, which encourage disabled people to apply for and to be accepted as employees. It told of the disability awareness training that it gives to its non-disabled and disabled staff within its stores. It told of the expectation that its suppliers would have an equally positive attitude to disabled people. Tellingly, it told of the Norwich store which has specialised in making kitchen fittings for people in wheelchairs. It has discovered a gold mine, because disabled people have commercial needs. They go out and buy things, and a service provider who meets their needs will reap the benefits from that. There is a commercial argument for organisations including those 8 million people in their marketing plans, which will be a relief to the hon. Member for Gainsborough, who expressed doubts.
I shall tell the story of a receptionist in a local authority office close to where I live. He is blind, but he welcomes people to that office, functions very well as a receptionist and telephonist and is not disabled because the facilities are present to give him all the abilities that he needs to carry out that vital job and exceed the reasonable expectations that could be demanded of him.
I have told that story to make the point that the barriers that prevent disabled people from playing a full, positive and constructive role in society have been erected by us—not only the politicians, but able-bodied people, service providers, employers and anyone else who does not think about the consequences of their words, deeds and actions for disabled people. We can take those barriers down. We can give disabled people the emancipation that they deserve and that it is their right to have.
The Disability Rights Commission and the awareness-raising activities associated with it are steps along the way but, however good today is—it is a wonderful occasion—it is only another step along a long road, the end of which we still have to reach.

Mr. Peter Luff: The eerie light of consensus has illuminated the debate, although that did not characterise the debates in the previous Parliament, during which I frequently expressed exactly the same objectives as the hon. Member for Kingswood (Mr. Berry), but sought rather different mechanisms to secure them. We could never have foreseen that those loud and noisy discussions would end in such a way as they did today—not with a bang, but with a whimper, which is good. Disability issues should not be the subject of the fierce partisan battles that took place in the previous Parliament.
I congratulate the Minister on his opening remarks; he struck the right note, although there were hints of a return to partisan comments from other hon. Members. It is no doubt true that the Bill would probably not have been introduced by the previous Conservative Government—we can say that with a reasonable degree of certainty—but I am not so sure that that could be said of a Government led by my right hon. Friend the Member for Richmond, Yorks (Mr. Hague), the Leader of the Opposition. He is committed to the measure. [Interruption.] If the hon. Member for Kingswood ever has the good fortune to serve in a Government, he will sometimes find himself at the Dispatch Box saying things with which he does not entirely agree. Such is the nature of collective responsibility.
It is worth putting on record the fact that the previous Government did a considerable amount on disability issues. When Baroness Thatcher was Prime Minister, she attached great importance to the welfare spending issues related to disability. Contrary to the myth the she constantly slashed expenditure, she trebled spending on benefits for the long-term sick and disabled; and her successor, my right hon. Friend the Member for Huntingdon (Mr. Major), continued the process.
We also introduced the Disability Discrimination Act 1995, which the chairman of the National Disability Council has described as a good Act, although I agree that David Grayson, who is a good friend of mine, wants that Act to be toughened. Indeed, the Bill does just that, but those were real and substantial achievements for disabled people which I hope the whole House would welcome. I rather resent the note that has been struck by some Labour Members, who have said that nothing happened for disabled people in the previous Parliament. A considerable amount happened.

Mr. Oliver Heald: Disability living allowance.

Mr. Luff: From a sedentary position on the Front Bench, my hon. Friend reminds me about DLA. He is absolutely right to do so.
How do I approach this Third Reading debate? With mixed feelings—all my doubts remain about establishing a body with the powers that the commission could have, but the disability rights lobby still wants a commission to

be established. The mood in the House is clearly in favour of a commission, so this is the time to lie back and accept the inevitable. I can do so with a clear conscience because I am encouraged by what Ministers have said about how they expect the commission to use the powers being given to it.
It is right to emphasise our hope that the commission will use those powers in the way that Ministers hope it will use them. As my hon. Friend the Member for Gainsborough (Mr. Leigh) said, clause 4—and, indeed, clause 5—contains considerable powers and they could harm the cause that the commission has been set up to help if they are used insensitively.
The Liberal spokesman talked about the omissions from the Bill, and I hope that the commission will consider not only employment matters, but issues of democracy. The House is still inaccessible to disabled people and that is one of the things that we should put right as a matter of the utmost urgency. In my previous incarnation in the House, my constituency contained New college, which is run by the Royal National Institute for the Blind in Worcester. Issues relating to blind and visually impaired people are at the forefront of my thinking and I hope that the commission will do what it can to improve voting forms.
I will put pressure on the Government to make it easier for disabled people to exercise their most fundamental right of all—the right to vote—and for people who are disabled but do not have visual disabilities to gain access to polling stations, which is often scandalously difficult to achieve. There are many issues for the commission to address that relate, directly or indirectly, to the way we carry out our business. I hope that it will do so with enthusiasm.
On a slightly partisan note, I hope that the commission will not be frightened of taking on the Government over their allowance for county social service departments. Despite all the good words that we have heard today about the great achievements of the Government, disabled people and their carers—in Worcestershire in particular—face serious problems because of the scandalously low funding increase offered by the Government. I hope that the commission will speak out on that, too.
Although I can give the establishment of the commission a rather less guarded welcome that might otherwise have been the case, I want to strike a note of dissent from everything that has been said about the Government's hearts and minds campaign. Ultimately, the fundamental point is that no Act of Parliament can ever change the way people behave. The real discrimination lies in people's hearts, and that is what must be tackled.
I have no objection to a hearts and minds campaign, but this is a bad one. When I first saw the poster about Kathy, outside Worcester Shrub Hill station, I thought that it was either advertising a sequel to a programme on homelessness or trying to attract people to a teacher training campaign. I could not work out what the poster was about and realised what it was advertising only today, when hon. Members referred to its subtext. I hope that the commission will do a much better job of winning the hearts and minds of the British people than the Department for Education and Employment is managing at present.
None the less, this is a momentous occasion. We have put to rest one of the great, contentious issues that has divided the House over the years, and done so in a


constructive way. The Minister rightly paid tribute to a number of individuals and, although I have crossed swords with him on a number of occasions, I emphasise my personal congratulations to the hon. Member for Kingswood, who has played an extraordinary part and driven this issue through the House. He, together with all the other people to whom we have paid tribute today, deserves a share of credit for what he has done. I hope that his best hopes are achieved and my worst fears are never realised.

Mr. Harry Barnes: I hope that it goes without saying that the House would expect me to support this measure and to believe that this is an important day to celebrate. It is a stage on the road to the objective of full civil rights for disabled people and it is, therefore, strongly to be welcomed.
The Liberal Democrat spokesman, the hon. Member for Winchester (Mr. Oaten), attacked the yah-boo approach to this subject that has prevailed in the past. Although I accept that a lot of yah-boo politics and trivial point scoring take place in the Commons, I am in favour of a strong debate taking place, particularly on this subject. Had we not had as much outside campaigning and as many arguments from the previous Government about this issue, as well as a distinction between the principles involved, we would not have reached this point. Had the measure been sorted out by men and women of good will sitting around a table, we would not have achieved this sort of legislation and would not have tested out each others' ideas in quite the same way.
The strength of the ideas expressed by Labour Members, with the support of the Liberal Democrats, prevailed after the tussle with those who had other ideas. I was pleased that the hon. Member for Gainsborough (Mr. Leigh) spoke, because I remember some of the tussles with him. The views that he expressed today showed that, fundamentally, he still has the same attitude. It is important to have that honourable dispute in developing different positions.
When I introduced my version of the Civil Rights (Disabled Persons) Bill, which was a private Member's Bill, the hon. Member for Gainsborough spoke against it because he was worried about intrusive regulation. He now hopes that the operation of the changes will be benign, but in the past he expressed great fears that legislation of this type would not be benign. I remember pointing out that his arguments were against the Disability Discrimination Bill, which was going through the House at the same time. To judge by the look that he gave and his response on that occasion, and despite the fact that he was using the Disability Discrimination Bill to argue against the measure that I was proposing, he recognised that that was what motivated him.
We all benefit from such argument. John Stuart Mill once said, perhaps in a slightly sexist way, that he who knows only his own side of the argument knows little. Our argument was certainly developed considerably as a result of coming into conflict with the views of people with differing attitudes. One person who had a strongly differing attitude on this matter was the Leader of the Opposition. In the period to which I refer, two Bills

were in competition with each other: the Disability Discrimination Bill and the Civil Rights (Disabled Persons) Bill. I am convinced that we would not have secured the Disability Discrimination Act 1995 if, the preceding year, the Bill proposed by my hon. Friend the Member for Kingswood (Mr. Berry) had not been scuppered with a great deal of blood and heated yah-boo on the Floor of the House.
I then picked up the baton and ran my hon. Friend's measure. The techniques that were used against my Bill were different from those that had been used against his. It was a rival measure, while the blocking of the Civil Rights (Disabled Persons) Bill took place essentially in Committee with attempts to stop it getting back to the Floor of the House. The person who carried out those opposition techniques almost single handedly in Committee was the Leader of the Opposition.
Having talked to a Conservative Member who is now a Labour Member, the Minister for the Arts, my hon. Friend the Member for Newport, East (Mr. Howarth), I found out which Conservative Members to ask to join us. Most Conservatives and others sat on my side of the Committee and the Leader of the Opposition was often almost alone in battling for his position. He had to engage in all the filibustering on the amendments and would agree to the Bill's coming out of Committee only when nothing could be done with it. We had only 32 minutes on the Floor of the House in which to take about 108 amendments. The Leader of the Opposition gained promotion partly as a result of the role that he played in scuppering civil rights for disabled people.
I was pleased to hear the Minister say on Second Reading that civil rights for disabled people are on the agenda in the future and that we are moving in that direction. I welcome the fact that in the debate on the Queen's Speech the Leader of the Opposition immediately expressed support for the measure before us today. That, however, is a significant change and it comes about as a result of the nature of politics in this country. Those politics sometimes take place on the Floor of the House in the form of strong debate and dialectic argument, which help to produce the situation in which we find ourselves today. I am therefore keen that that sort of yah-boo should continue to take place. There was a sign of it in coded language in the speech of the hon. Member for Gainsborough.
Although we have had an interesting discussion on this Bill, it has been a little too cosy. One often needs arguments to be propounded that challenge one's own ideas, so that those can be improved. The ideas in the Bill have been challenged so much in the past that they are sufficiently well shaped and we did not need the disputes that we have had in the past. I welcome the fact that we have reached this stage and, like all good campaigners, I look forward to the next one.

Mr. Andrew Smith: By leave of the House, I shall respond as briefly as possible to some of the points made in the debate.
First, may I welcome again the positive and generally constructive spirit that has prevailed? The hon. Member


for Daventry (Mr. Boswell) asked about resources. We are satisfied that the commission will be adequately resourced. We have looked at the experience of the Equal Opportunities Commission and the Commission for Racial Equality. The hon. Member for Winchester (Mr. Oaten) said that we needed to monitor the resourcing. It will be monitored and kept under review. It is generally accepted, however, that the £3 million start-up cost and the £11 million annual budget that we have provided for should be adequate.
The hon. Member for Daventry also said that we should be careful to ensure that the big stick was used only where necessary, and the hon. Member for Mid-Worcestershire (Mr. Luff) made comments in a similar vein. Although the statutory enforcement powers in the Bill are a last resort, it is necessary to have them to ensure that the law is complied with. The Bill is about ensuring that disabled people have rights not only in theory but in practice.
Obviously, we expect this legislation and the proceedings of the commission to work in a business-friendly way. Equally, we expect business to work in a disabled-friendly way. That is part of the general shift in culture to which a number of hon. Members referred.
I echo what the hon. Member for Daventry said about the importance, when it comes to litigation, of bearing in mind the circumstances of the parties likely to be involved. In terms of proceedings on investigations by the Disability Rights Commission, there will be a requirement, where appropriate, to have timetabling of those proceedings, which will offer a safeguard against the delays which the hon. Gentleman rightly said would be unacceptable.
I thank my hon. Friend the Member for Kingswood (Mr. Berry) very much for his kind remarks and for those of the all-party disablement group. As others have said, if my hon. Friend had not promoted his Bill in the previous Parliament, followed in similar vein by my hon. Friend the Member for North-East Derbyshire (Mr. Barnes), we would not be here today establishing the Disability Rights Commission. They deserve tributes, together with Alf Morris, Jack Ashley and others.
The hon. Member for Winchester asked whether written agreements would be made public. As is evident from my answer on Second Reading, I share his instinct for openness, but we have seen how that could be counter-productive. There is no statutory requirement for a public register of agreements or for written agreements to be kept private. It will be for the DRC and the organisation concerned to discuss when reaching the agreement whether it should be made public and under what circumstances. That is only common sense, because we do not want an organisation to refuse to enter into an agreement that would be in the interests of disabled people because it would be made public.
The hon. Gentleman also referred to anticipated discrimination. It will be open to the commission to make recommendations for further legislative enhancements of the rights of disabled people or their enforcement. That covers the circumstances that he referred to.
The hon. Member for Gainsborough (Mr. Leigh) hoped that we would not think him churlish in expressing

caution and an incomplete conversion to the Bill. I hope that I do not sound churlish when I say that he sounded churlish, but as my hon. Friend the Member for North-East Derbyshire pointed out, it does no harm for such matters to be tested in debate. Out of the fire of the debate in the previous Parliament we have tempered a sensible proposal for the commission. The hon. Gentleman may have been unhelpful to his present leader by reminding the House of his previous position on the issue. However, we welcome all converts to the Bill, whatever their attitude before.
My hon. Friend the Member for High Peak (Mr. Levitt) made a good point about awareness, which answered some of the reservations of the hon. Members for Gainsborough and for Mid-Worcestershire. The B and Q example shows that with a thoroughgoing approach to disabled people's rights an employer can not only recruit the best employee for the job, but offer the best service to the whole range of customers. There is a commercial imperative as well as a moral one behind rights for disabled people. By working with employers, the commission will be helping the business case for equality as well as the ethical and moral case.
I hope that the Bill will gain a Third Reading with the unanimous support of the House. We should remember that the commission is not the end, but a very important means to the end. As my hon. Friend the Member for Blackpool, South (Mr. Marsden) said, it will be a spur to cultural change and an empowering device as well as a source of advice and a means of redress. The practical benefits in the lives of disabled people and all of us that will result from the establishment of the commission will be its real achievement. We shall all benefit from the cultural change and empowerment of which the commission is an instrument.
The unanimity and enthusiasm in the House for the establishment of the commission is great to see. As well as all that it will be able to achieve through consensus and discussion, we should bear in mind the fact that the commission will sometimes have to take tough and perhaps controversial decisions. I hope that it enjoys the same consensus and enthusiasm when it has to do that, because that will be the test of making a reality of disabled people's rights.
Given the extent of support in Parliament and among the public as the Bill moves to a Third Reading, the commission will get off to a good start. It is a milestone in advancing disabled people's rights. It is time to move past that milestone towards a better future in the lives of disabled people and us all.

Question put and agreed to.

Bill accordingly read the Third time, and passed, with amendments.

Orders of the Day — FINANCE BILL

Ordered,

That, notwithstanding the practice of the House as to the intervals between stages of Bills brought in upon Ways and Means Resolutions, more than one stage of the Finance Bill may be taken at any sitting of the House.—[Mr. Dowd.]

Orders of the Day — DELEGATED LEGISLATION

Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

CUSTOMS AND EXCISE

That the Excise Duties (Personal Reliefs) (Amendment) Order 1999 (S.I., 1999, No. 1617), dated 10th June 1999, a copy of which was laid before this House on 11th June, be approved.—[Mr. Dowd.]

Question agreed to.

Orders of the Day — Bereavement Care

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Dowd.]

Mrs. Virginia Bottomley: I am privileged to have the opportunity to address the House on an intensely important matter that is rarely discussed on the Floor of the House and is almost as widely ignored among the vast majority of people. The subject is bereavement.
The few speeches and debates about death usually fall into one of two categories: how to stop it and how to make up for the lost wages. We can never prevent death. As Benjamin Franklin, the leading US political philosopher and inventor of the lightning conductor, said 200 years ago,
in this world nothing can be said to be certain, except death and taxes.
Whereas in Victorian times there was much discussion and debate about death, but sex was taboo, in our generation, there is much debate and discussion about sex, but the question of death has become taboo. Debates about how we can prevent death are numerous. Of the 220 all-party groups in the House of Commons, around one in five concern health or health-related matters. In last week's debate about widows pensions, we talked about making up for lost wages and the upgrades to provide for widows, but no mention was made of the emotional difficulties of bereavement counselling.
For many years, I was vice-chairman and am now vice-patron of what is now the Carers National Association, which came into being to provide support and recognition for carers. For those who have been caring for an elderly relative, the experience of bereavement and being left on their own and isolated after the death of their loved one causes at least as much difficulty.
There have also been debates about the regulation of the funeral industry. There has been a welcome for the expansion of the voluntary funeral ombudsman service. Around 21,000 people are involved in the funeral industry. They require greater recognition, more training and more respect in the community. The National Association of Funeral Directors has introduced excellent initiatives on that, but people still tend to be bashful about saying that they are an undertaker and they are not regarded as being as important to the community as midwives.
Inevitably, death is usually seen as intensely personal, or too frightening to discuss and accept for what it is. When discussing the television film about the man who had his own process of death filmed, Lord Winston—who, appropriately, is a professor of fertility studies at Hammersmith university—recently said:
We live in a society which hides death because it is beyond our control and, partly in consequence, we are terrified of it. In hiding death, we make it a taboo.
There have been other interesting accounts, such as Virginia Ironside' s book "You'll Get Over It: the Rage of Bereavement", in which she describes how, before her father died, she thought that she knew a little bit about bereavement:
In my job as an agony aunt I would blithely send out leaflets to bereaved people full of kindly, sympathetic advice, telling them about stages of grief.


Colin Murray Parkes is a president of Cruse, and his academic work and practice have helped us understand more about the process of bereavement, and made an enormously important contribution.
Virginia Ironside said that when her father died
nothing made sense. Perhaps he was resting in peace",
and that grief
was only a minuscule part of the process … with other shameful feelings of rage, greed, loathing, hatred for life; physical feelings of lethargy, shooting pains in my legs, a permanent ache in my neck, and a new, embarrassing interest in religion and the afterlife. And there was relief. He had been a loving but emotionally and intellectually dominating figure. Now he was gone I could breathe. And yet how can anyone breathe when consumed by the fury of loss?
That is an open account, but typical of the experiences that people have when, without previous thought, preparation or consideration, they find themselves in the turmoil of bereavement. That contrasts starkly with the process of childbirth, for which there are preparation for parenthood classes, the National Childbirth Trust, support from health visitors and so on. People understand that childbirth is a life stage with implications both for themselves and for their immediate families.
However, there is little to help prepare grieving relatives, work colleagues and associates for death. Fortunately, in 1959, Cruse was founded by Margaret Tome, OBE, who was concerned about the isolation and poverty of young widows and their children. She established the first group, in the Richmond area, and supported many young widows and helped them to find ways of surviving emotionally and financially.
As a result of the publicity, other Cruse groups were formed around the original group, offering support not only for widows, but for others affected by death, including children, and people of all ethnic and religious backgrounds. Today, for example, three out of 10 of those who seek assistance from Cruse are widows, one in eight are widowers, one in three have lost a parent, and one in 10 have lost a child. The picture of bereavement moves on.
I used to support Cruse when I was a Minister at the Department of Health. I was also approached by Cruse in my constituency to speak at a fundraising concert in Guildford cathedral. In the light of my on-going interest in the activities of Cruse, I am pleased to say that it has asked me to be a patron, so I should declare that interest to the House.
Now, under the leadership of its executive director, Dr. Carole Easton, Cruse is still based in the Richmond area and after 40 years, it is busy preparing itself for the challenges of the next generation and the next century. There are now 188 branches throughout the United Kingdom, and I am pleased that it is acknowledged by the Home Office as a lead voluntary organisation for dealing with major disasters in the United Kingdom.
Cruse has certainly gained the respect of many in the medical profession, and 45 per cent. of its clients are now referred by their general practitioners or other health professionals. At this moment, the General Medical Council and others are discussing, with the all-party group on primary care, the nature of GP training. Before I left the meeting early, I said that one of the important steps in the training of GPs, and all medical professionals, should be how to handle death. It is a difficult and sensitive subject for the professionals involved as much as for bereaved families.
The challenge now is to ensure that everyone in the United Kingdom knows about Cruse. People need to know that there is a place where they can get help in dealing with the complex and intense emotions associated with death. They need not only support and comfort, but practical advice. The complexities of death—such as the forms to be filled in and the process of organising a funeral service—do not come routinely, and are not widely understood.
It is not only bereaved people who need to know about Cruse. Employers, health care providers, ministers of religion, educators and family and friends all need to know that the best support that they can give someone struggling with a loss is to lead them to someone else—someone who has been trained to deal with bereavement.
The services that Cruse offers are varied. Each bereavement is different. There is no one way to help someone to cope with a loss. The different branches across the country are flexible. The focus is on counselling, but they also act as a source of practical information and practical assistance. Some clients are seen in their own homes; others attend the centres; some choose to talk on the telephone.
At the latest count, there were 154 social groups, 165 specialised groups, including groups for the recently bereaved, and 60 drop-in centres. Last year, they provided face-to-face counselling for more than 21,000 clients, counselled 5,500 clients over the telephone and received 110,000 requests for information about their services and about surviving a loss.
Each year in this country, about half a million people die, and only a fraction of the bereaved look for specialist support and help. However, investing in caring for those people at the time can often lead to safeguards for the future, better functioning and a less prolonged mourning period.
There has been an increase in the more traumatic forms of death. Anyone who has acted as a Minister with responsibility for roads will have met many parents of young people who have been killed in traffic accidents. Sudden death is often all the more distressing—not only from traumatic causes such as a road accident, a murder or a heart attack; any form of death that has taken the family unawares can leave people feeling confused, angry and needing help.
Perhaps the most worrying aspect of the loss of life for this generation is the growing number of people who take their own lives. More young men now take their lives through suicide than are killed on the roads. When people take their own lives, the effect on parents, grandparents, siblings and friends is all the more distressing and traumatic. There is associated guilt, anger, perplexity and sadness, and people often need expert help and support to talk that through. Cruse has created specialised groups to provide care for those who have lost loved ones from a range of particular causes.
The population is ageing; that is well understood—but it leads to a need to change the services designed to help people who are bereaved. Old people are more likely to have to deal with death alone when a spouse, child or friend dies. They are more often left isolated, with nowhere to turn and no one to turn to. More than 30 per cent. of those who seek assistance from Cruse are over 60.
Cruse has been able to establish itself as a link between the elderly and bereavement care. With the advances in modern medicine, it is crucial that Cruse maintains its


connection with elderly people. People who live longer will see more other people die. Elderly women, especially, are at risk, because their life spans continue to exceed those of their spouses—and in many cases, those of their children.
We in this country pioneered the development of hospices: a concept that is now respected around the world. The hospice movement has effectively removed the physical pain of death and dying, but that still leaves a huge gap in emotional and practical support, for which we must provide better services. There are complexities involved if people are bereaved when they are homeless or in prison. The growing number of divorces has led to more complex and ambivalent feelings. When someone dies who was long since divorced, the experience can bring back many old sensitivities and hurt feelings.
Cruse works through a remarkable army of 6,500 volunteers giving from two to 10 hours a week of their time. They certainly deserve our gratitude. Many know how hard it is to offer condolences to a friend or colleague who has experienced a loss. Cruse's commendable volunteers give their time to help those who need a kind word, a shoulder to cry on or an attentive ear.
In this generation, there is a need to refocus on the importance of that gift relationship and the role of volunteering. I hope that more people will feel that becoming a Cruse volunteer is a constructive way of investing back in the emotional and social fabric of their community. In my constituency, Cruse operates the Guildford and Waverley branch, based in Godalming. I want to express my profound appreciation, on behalf of the local community, for the effective and professional support that it offers my constituents.
Cruse's plans for the future will succeed as long as the Government are able to give their support, encouragement and authority and help it to overcome the complex labyrinth of funding mechanisms, grants and available resources. As it moves to the next decade, Cruse is planning improvements to make it even better able to provide help to the bereaved. Its development plan proposes that it further diversifies the services that it offers, giving more support, information and advice.
Branches need back-up and professionalism. Today's public are discriminating consumers of services and demand a professionalism that may not have been so essential in years gone by. Management of the branches will be restructured so that the volunteers can concentrate on delivering the services and receive better support and back-up from headquarters. All the change is being led by the executive director, Dr. Carole Easton. She is undertaking a major consultation exercise with the branches to prepare the organisation for the next century.
The key millennium project that Cruse wants to undertake is to develop a national Cruse helpline: a telephone number that anyone anywhere in the country can ring to get advice, support and encouragement. It wants to establish a centrally answered telephone service that is readily accessible to anyone, including deaf people and non-English speakers.
Inevitably, like almost every not-for-profit organisation, a crucial and central preoccupation for Cruse is how it can secure the funding to maintain its services. To offer increased services, volunteer training and numbers need to

be increased. Cruse needs funding to allow it to recruit, train and support effectively volunteers of all ages and ethnic backgrounds.
Last year, Cruse helped 110,000 people at an average cost of only £23. It has done remarkable things with the little money that it has. It can continue to do that, but it needs and deserves increased income. Its current income is simply not sufficient to allow it to expand its services to the extent of its potential.
The question is how we can help Cruse to provide the best possible support. Almost everyone who has had experience of Cruse wishes that more people knew about its services. If it is to raise its profile and expand its services it needs to expand its budget.
I want in fairness to acknowledge the funding that the Government have provided. This year, Cruse was granted £60,000 a year for three years for a quality care-in-bereavement project. Last year, it was granted £40,000 a year for three years as part of the regional support network project. In 1997, it was granted £150,000 over three years as part of that project and in the same year it received £97,000 over three years for an equal opportunities officer project. Time and again, Cruse receives a packet of money for a specific project, which is welcome in itself but does not solve the underlying problem of core funding to support its headquarters and the services that it provides every day.
I am delighted to report, as an echo of days gone by, the number of lottery awards that Cruse has received. There was a phase in my life when every question that I had to answer involved how many lottery awards had been made available for a project. Cruse has received 29 National Lottery Charities Board awards, totalling £837,000, ranging from £120,000 for a training and development programme to £736 towards the start-up costs of a group in east Sunderland.
I hope that the Minister will be able to help Cruse to access more substantial sources of funding. There are several initiatives under way that may offer Cruse an opportunity. "Our Healthier Nation" identified mental health as an area in which the Government want the national health service to make more progress in preventing ill health. Is it possible to consider some of the mental health sources of funding?
In exploring resources locally, Cruse branches have found that they get sent from the primary care group back to the mental health trust and on to the health authority or social services. Are there any guidelines to make it clear which was likely to be the primary source of funding for a project as evidently worthwhile as Cruse?
Savings can be made in long-term mental health services and people will be able to invest in other aspects of education and employment if they can overcome the mourning process more swiftly, so supporting Cruse provides excellent value for money in the true sense of the phrase. In a study published in the European Journal of Palliative Care, Marilyn Relf argues that support from volunteers leads to bereaved people using their GPs and medical services less. Any way of saving the NHS money is welcome.
I hope that the Minister will appreciate that it is of the utmost importance to assist Cruse to meet its funding challenges. Many elderly people have mobility problems, so it needs to expand its capacity for home visits. Above all, there is the national Cruse helpline, which will need core funding and assistance.
There is a difficulty that is becoming progressively more evident. I suspect that the Minister is already aware of it. I spoke this morning to Marjorie Wallace of Saneline who, like the supporters of Childline and the Samaritans, believes that the establishment of NHS Direct has led to a strangulation of funding for the other national helplines.
I appreciate the difficulty of Ministers funding all their pet projects, but if £14 million goes to NHS Direct while all the existing, highly professional and valued helplines wither, it will be seen to be an error of priorities.
NHS Direct will undoubtedly take calls from those for whom bereavement, mental health or children's difficulties are the primary concern. I believe that NHS Direct will need and benefit from the experience and specialised expertise of those professional national helplines. Therefore, I very much hope that the Minister will be able to re-examine that particular difficulty.
The deeply moving funeral of the late Cardinal Hume was held only last Friday. Not very long ago, the nation suffered an enormous outburst of grief at the death of the late Diana, Princess of Wales. The emotion surrounding those two events—perhaps like the effect in "Four Weddings and a Funeral" of the reading of W. H. Auden's poem—are modern examples of occasions on which attention has been focused on death and bereavement. Nevertheless, the subject is all too rarely debated in the House.
I believe that the Minister could raise the subject's profile, and increase not only the acceptability of seeking specialist help, but the availability of help in dealing with a specific crisis in family life. The Government's communication skills exceed all others, and I hope that the Minister will be able to help to identify Cruse as an organisation for which the Government have special regard.
I have some specific questions. First, how can the Minister help Cruse to raise its profile, to ensure that people know about it without having to struggle to discover it? Secondly, has he visited the Cruse branch in his constituency or in any other constituency? Thirdly, what research is being done on bereavement care? Fourthly, what can the Government do to help Cruse to keep functioning for another 40 years? Fifthly, will there be more joined-up funding for Cruse from various Departments? Although I realise that it is not easy to have responsibility for millennium volunteers, lottery awards and health funding, we really should have a map and a navigator on the bereavement issue. Sixthly, how will the Government help Cruse to celebrate its 40 years of service? It is certainly hoped that the Minister will attend the party that Cruse hopes to hold for hon. Members—on 20 October, on the Terrace—not only to celebrate its success, but to discuss its plans for the future.
Above all, in thanking the Minister for being here to reply to the debate and in welcoming the workings of the House, which enable us to continue this debate until 10 o'clock—I do not want to cut short the hon. Gentleman's remarks in any way—I ask him to join me in congratulating Cruse on 40 years of service and in commending its staff and volunteers for all their hard work and dedication to helping others.

The Parliamentary Under-Secretary of State for Health (Mr. John Hutton): I warmly congratulate the right hon. Member for South-West Surrey

(Mrs. Bottomley) on raising the subject of bereavement and drawing the House's attention to the outstanding service that Cruse provides. I should also like to congratulate her on her recent appointment as a patron of Cruse. The House will be very well aware of her long-standing interest in mental health issues.
The right hon. Lady has asked me some specific questions, and I certainly want to answer them in my speech. However, she started her speech by saying that bereavement is a taboo subject, and she was right about that. Nevertheless, bereavement is something that we shall all experience.
Bereavement might be coupled with feelings of guilt—to which the right hon. Lady referred—particularly if an elderly relative has died in residential care, for example. There may be difficulties for working-age adults, when a partner is left behind, not only in coping with their loss, but also perhaps with a young family. There may be trauma for younger children facing the death of a parent, or for parents facing the loss of their child.
Our concern should extend beyond the effects of bereavement on family and friends. The attitudes of staff in the national health service and in various agencies are very important in helping families or loved ones to begin to come to terms with their sense of loss. It is therefore very important that staff working in both the NHS and social services are sensitive to the needs of the families of their patients. However, it is also important that they do not "medicalise" normal grief reactions.
The care offered need not be specialist help: much of it is common sense. Staff need to keep relatives up to date about the condition of a critically ill family member, and support them when told of his or her death. People need practical information, such as guidance on necessary post-mortem procedures, on contacting funeral directors—to which the right hon. Lady referred—or on notifying friends or relatives of the death.
The right hon. Lady rightly mentioned some of the wider issues in death and bereavement, not the least of which is the economic cost to the nation of bereavement, which some estimates place as high as £800 million annually.
The right hon. Lady also rightly spoke extensively about the work of Cruse. I associate myself and all my colleagues in the Government with the very warm words of praise that she expressed about the work of Cruse, which is the major organisation in bereavement counselling. The healing process following a bereavement can take a very long time, and the bereavement counselling done by Cruse can play a big part in that process.
In opening its doors to all bereaved people, Cruse bereavement care offers a free and confidential service to all those who need it. The trauma following bereavement can affect all ages and, without sensitive care, can often lead to other problems. I pay tribute, as the right hon. Lady did, to Cruse's work.
I have already mentioned young people coming face to face with death. Ensuring the mental health of children and adolescents is a matter of key importance for us all and is among the Government's national priorities for both health and social services in the next three years. It is an important issue, as mental health problems in young people not only hinder their own life opportunities but create distress for their families, obstacles for teachers, and tensions in the wider community. We are therefore


dedicating new resources—£84 million in the next three years—to supporting the development of effective child and adolescent mental health services.
Cruse is certainly to be congratulated on the introduction, in March 1998, of a new national "Youth Line" service to help bereaved children and young people to come to terms with their loss. The telephone helpline gives young people the opportunity to talk to a trained counsellor about their loss, to explain in confidence the particular difficulties they are facing, and to receive advice on how to cope.
Much can be achieved in promoting the mental health of young people by helping them to cope with major life events and experiences, such as bereavement and parental discord and divorce. The death of a parent is a particularly well-recognised risk factor in the development of emotional and behavioural problems. In such times of distress, young people may welcome the opportunity to talk things over with someone outside the family circle who is knowledgeable, sympathetic and easy to approach. Voluntary groups have traditionally played a very significant role in providing information, advice and counselling in an informal and user-friendly way. Cruse is already providing precisely that type of service.
The Government recognise the vital role that Cruse plays in offering a free nationwide service—to a consistently high standard—of counselling, information and social support to anyone who has been bereaved. It also offers training, support, information and publications to those who work in caring for bereaved people, and increases public awareness of the needs of the bereaved through education and information services. That is why we have supported Cruse with section 64 grants for several years. For example, we gave Cruse core finding for five years, until last year, amounting to over £500,000, and are providing grants for four of its projects, some of which were mentioned by the right hon. Lady.
The first project is development of a regional support network, which aims to develop and maintain Cruse's network of local branches by developing the role of its regional officers. The officers provide support and training for Cruse volunteers and help to maintain quality standards and monitor all aspects of work of local Cruse branches. Funding for the project is £50,000 per annum for three years, which started in 1997.
The second project, on the development of regional support for bereaved people and Cruse volunteers, aims to provide support in training and management for Cruse volunteers in central and northern England, to ensure proper communication between their headquarters and support groups and to develop and maintain a Cruse branch network in those areas. The project also helps develop new branches of Cruse in those areas. We are funding this project for three years from 1998–99 with £40,000 for each year.
In addition to that support, we are helping the equal opportunities officer project, which seeks to promote good and consistent equal opportunities practice among Cruse branches. The project grew out of a recognition that Cruse needed to broaden accessibility to the services that it provides to clients and potential volunteers from all sectors of the community. We gave this project £35,000 in 1997–98, £32,000 in 1998–99 and £35,000 in this financial year.
Finally, the quality care in bereavement project is designed to ensure that all clients of Cruse receive the best possible care, support and information. The project defines what is essential for quality care and ensures that the mechanisms to deliver it are in place. The Department began funding this project this year and will continue to do so until 2001–02, with £60,000 for each year.
In answer to a question from the right hon. Lady, let me say that the Department is not funding any specific research into bereavement care at present. However, I should be happy to discuss with Cruse representatives any ideas that they might have in that regard.
In total, our financial help for Cruse this year amounts to nearly £200,000. That is an indication of how well we regard the organisation and how strongly we support its aims. As the right hon. Member for South-West Surrey knows, I have already arranged to meet Cruse's director, Dr. Carole Easton, next week. I look forward to that meeting so that she can tell me at first hand of the work of her organisation. We will also discuss how the Government might be able to help with plans to develop a national telephone helpline as part of Cruse's millennium project. The right hon. Lady asked specifically about that, and I can confirm that we shall be happy to discuss any detailed proposals that Cruse might want to put to us.
My Department has been a supporter of a number of voluntary organisations that run helplines. They include Sane, the Samaritans and the National Schizophrenia Fellowship. We have been doing some work with the organisations to see how they can best be linked to the NHS Direct helpline. That helpline may be best placed to offer general advice about local service provision, with the voluntary organisations able to offer specialist advice on mental health issues, as appropriate.
Again, the right hon. Lady drew my attention to the work of the Saneline service, and I want to place on record my appreciation of, and admiration for, what that service provides. We certainly do not want that service to wither on the vine. In the near future, I hope to be able to discuss with Sane its concerns in more detail.
Indeed, this Government recognise fully the vital role that voluntary organisations such as Cruse play in helping people cope with their grieving and the loss of a loved one. Apart from Cruse, we are also funding three other organisations that deal with bereavement to the tune of some £90,000 in the current financial year. People suffering a loss often turn to the voluntary sector first, because it is seen as user friendly and perhaps more understanding of the difficulties that they face, and because it is regarded as having a sympathetic ear.
It is important for us all to remember and recognise the important role played by the wider voluntary organisations in promoting mental health and meeting the needs of the mentally ill. Much of the innovation takes place in that sector and we must make sure that we learn from their experiences. We are supporting some 64 voluntary organisations working in mental health with some £4.2 million of funding this year. That is a record sum.
We should also keep in mind that mental health problems are as common as asthma. Mental health is not, therefore, a marginal issue for the NHS or for social services. Improving the mental health of our country is one of the new national priorities for health and social services.
In recognition of that, we have launched the biggest investment and reform programme for mental health since the inception of the NHS 50 years ago. An extra £700 million will be invested in improving mental health services over the next three years. To underpin that investment, last December, we published our strategy document on modernising mental health services, which sets out the direction of travel for the national service framework for mental health.
That strategy will address unacceptable variations in services across England. It will set national standards for both health and social care, and establish performance indicators to measure the progress made by services, ensuring that they all meet basic criteria. It will address the whole range of mental health service provision, from primary care—where the majority of mental health problems can be managed—to specialist mental health services
Many, indeed most, of those who have suffered a recent bereavement will be in contact with their general practitioner or with other primary care health professionals. Older people may make that contact for their own health needs, and a general practice or district nurse may be in a prime position to identify their grief and the effects of bereavement. For others, the GP and others in the primary care team will have cared for their dying relative: either way, primary care staff have a unique role.
I am very conscious of the need for a primary care work force able to deliver consistent, good-quality, primary mental health care to people who have been bereaved and who, as a result, are often depressed and vulnerable in

both their physical and mental health. Many primary care teams do just that, but we know that depression may often be missed, especially when concurrent with other physical health problems.
I and my colleagues in the Department want the national health service to ensure that people who are bereaved and who present to their GP are properly assessed for their mental health needs and offered effective help and treatment, with referral to specialist services where appropriate. Primary care teams, along with specialist mental health services and social care agencies, should agree and implement protocols to that end.
We also want to make sure that grieving patients receive adequate information about the process of grief, their depression, and its management. Finally, we want to make available adequate information about the local voluntary agencies and self-help groups, such as Cruse, that can offer people expertise and services complementary to those of the NHS.
I therefore reassure the right hon. Member for South-West Surrey that we are continuing to support Cruse and that we value highly the service that it provides to our fellow citizens. I join with her in congratulating Cruse and all its staff and volunteers on their excellent work in this difficult but very important area. I also join with her in hoping and expecting that Cruse will continue that tradition for another 40 years.

Question put and agreed to.

Adjourned accordingly at twelve minutes to Eight o'clock.